• Source:JND
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The Employees' Provident Fund Organisation (EPFO) has decided to maintain the interest rate on EPF deposits at 8.25 per cent for the financial year 2025-26. The decision was taken during a meeting of the Central Board of Trustees (CBT) on Friday, chaired by Union Labour Minister Mansukh Mandaviya. The interest rate will be credited to contributors' accounts after the central government’s notification.

There were speculations of a possible reduction in the interest rate ahead of the meeting, but EPFO has retained last year's rate of 8.25 per cent. This keeps the EPF among the highest-yielding savings schemes. In 2022, the government had lowered the rate from 8.5 per cent to 8.1 per cent, but it was later increased to 8.25 per cent in 2024.

Higher Interest Than Other Savings Schemes

EPF interest rates remain competitive compared to other savings instruments. The Public Provident Fund (PPF) offers 7.1 per cent interest, while a five-year fixed deposit at the post office provides 7.5 per cent. Kisan Vikas Patra also offers 7.5 per cent, whereas a three-year term deposit yields 7.1 per cent. 

The Senior Citizen Savings Scheme (SCSS) and Sukanya Samriddhi Yojana (SSY) provide 8.2 per cent, while the National Savings Certificate offers 7.7 per cent. In contrast, post office savings accounts offer only 4 per cent interest.

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Key Changes In EDLI Scheme

Significant amendments were made to the Employee Deposit Linked Insurance (EDLI) scheme during the meeting. Now, if an EPF member passes away before completing one year of regular service, the nominee will receive a life insurance benefit of Rs 50,000. This revision is expected to help around 5,000 families.

Additionally, if an employee dies within six months of their last EPF contribution, their family will still be eligible for EDLI benefits, provided their name has not been removed from the payroll. This will extend benefits to over 14,000 families annually.

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A crucial change has been introduced regarding job transitions. If there is a gap of up to two months between jobs, it will still be considered continuous employment for EDLI eligibility. This modification will allow 1,000 more families to receive benefits. Earlier, even a one-day gap could disqualify employees from receiving the EDLI payout, which ranges between Rs 2.5 lakh and Rs 7 lakh. The revised rule is expected to benefit 20,000 families every year.

The Employee Deposit Linked Insurance (EDLI) scheme is automatically linked to EPF accounts. It provides life insurance coverage to all EPF account holders, ensuring financial security for their nominees in case of the insured employee’s death.

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