India Business Journal - Centre ratifies 8.25% interest rate on EPF deposits for FY25, rate same as last year’s

MONEY

Centre ratifies 8.25% interest rate on EPF deposits for FY25, rate same as last year’s

IBJ Bureau
May 25, 2025

The Centre has officially ratified an 8.25 per cent interest rate on Employees’ Provident Fund (EPF) deposits for 2024-25. This locks in stable, high returns for over 7 crore salaried Indians and reinforces EPF’s role as a core retirement savings tool.

The rate matches last year’s figure and was recommended earlier by the Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO).

With the Ministry of Finance’s approval, the rate will now be formally notified and credited later in this financial year.

This is the second straight year that EPF deposits will earn 8.25 per cent, a rate that stands above most fixed-income alternatives like bank deposits or government savings schemes. Last year’s payout was based on a record income of Rs 1.07 lakh crore on a corpus of Rs 13 lakh crore. In comparison, the rate for 2022-23 was 8.15 per cent, supported by Rs 91,151 crore on a corpus of Rs 11.02 lakh crore.

The impact is of the EPF rate is far-reaching. For employees contributing consistently over time, the monthly compounding of interest can significantly boost retirement savings. For instance, on a Rs 30,000 monthly salary with standard EPF contributions of Rs 5,950 (from both employer and employee), the 8.25 per cent interest greatly accelerates corpus growth over decades.