EPFO Maintains 8.25% Interest Rate for Provident Fund in 2025-26: What You Need to Know

EPFO Interest Rate Announcement

New Delhi: The Employees' Provident Fund Organisation (EPFO) has confirmed that the interest rate for employees' provident fund deposits will remain at 8.25% for the financial year 2025-26, marking the third consecutive year at this rate, as stated by the Ministry of Labour.

Last February, the EPFO had also set the interest rate at 8.25% for the 2024-25 fiscal year.

In 2024, the interest rate was slightly raised to 8.25% for 2023-24, up from 8.15% in 2022-23.

During a meeting led by Union Minister for Labour & Employment Mansukh Mandaviya, the Central Board of Trustees recommended maintaining the 8.25% annual interest rate for EPF accounts for the upcoming financial year.

This board serves as the highest decision-making authority within the EPFO.

The official notification of the interest rate will be issued by the Government of India, after which the EPFO will credit the interest to the accounts of its subscribers.

The ministry highlighted that despite global economic challenges, the EPFO has upheld strong financial discipline, ensuring stable and competitive returns without compromising the interest account.

Additionally, the Central Board of Trustees approved a one-time Amnesty Scheme aimed at resolving compliance issues related to income tax recognized trusts that have not yet been covered or granted exemptions under the EPF & MP Act, 1952, considering the provisions of the Finance Act, 2026.

This proposed scheme intends to bring various establishments and trusts into compliance within a specified six-month timeframe, primarily to safeguard workers' interests while waiving damages, interest, and penalties for those who have already provided benefits that meet or exceed statutory requirements.

It allows for retrospective relaxation or exemption under certain conditions, ensuring that all eligible employees receive their statutory benefits.

This initiative is expected to resolve over 100 ongoing litigation cases, benefiting thousands of trust members.

The scheme will apply to exempted establishments that have adhered to the EPF & MP Act, 1952.

The Board also approved a new simplified Standard Operating Procedure (SOP) for EPF Exemption, merging the existing four SOPs and the Exemption Manual into a single, comprehensive framework designed to ease compliance burdens.

This SOP introduces a fully digital process for the surrender and transfer of past accumulations.

The Central Board of Trustees has also approved the notification of new social security schemes under the Code on Social Security, 2020, to facilitate a smooth transition from the current framework.

The newly sanctioned EPF Scheme, 2026, EPS, 2026, and EDLI Scheme, 2026 will replace existing schemes, providing a legally sound foundation for managing provident fund, pension, and insurance benefits.

To address inoperative accounts, the Board has approved a pilot project for the automatic initiation of claim settlements for inoperative EPFO accounts with unclaimed balances of Rs 1,000 or less.

If successful, this facility will be expanded in future phases to include accounts with higher balances, further enhancing member-centric reforms within the EPFO.

The Board has also approved a comprehensive SOP to establish a transparent and timely framework for structured decision-making, enhanced oversight by the Investment Monitoring Cell (IMC), safeguards against reinvestment and interest rate risks, and a clear audit trail.

As of March 2025, the consolidated corpus exceeds Rs 28.34 lakh crore, with significant investments in Government Securities, SDLs, PSU Bonds, and other permitted instruments, making timely and structured decision-making essential for protecting members' funds and optimizing returns.

The Board has approved a comprehensive SOP aimed at improving fund management across EPFO schemes.

This reform includes the consolidation of funds, an annual SIP approach, defined operational timelines, and provisions for an overdraft facility.

The SOP also introduces a structured framework for Equity ETF investments with clearly defined entry and exit protocols, exposure limits, compliance controls, and enhanced oversight through the IMC.

It further strengthens liquidity management through regulated investments in Liquid Mutual Funds with defined holding norms and ongoing monitoring.

This framework institutionalizes improved governance through a defined approval matrix, strict adherence to government-notified investment norms, periodic reporting to the Central Board, and multi-layered audit oversight.

These reforms aim to maximize returns within prudent risk parameters, enhance liquidity planning, and protect the long-term interests of millions of EPF members.

The Board has designated the Institute of Banking Personnel Selection (IBPS) as the agency responsible for conducting direct recruitment and promotion examinations on behalf of the EPFO.

Regarding the higher pension, it was noted that following a Supreme Court ruling, a total of 17.49 lakh applications for Pension on Higher Wages have been submitted by members and pensioners.

As of February 23, 2026, approximately 15.24 lakh applications have been processed.