The Employees' Provident Fund (EPF) subscribers are unable to check the interest credit in their retirement savings account, according to a statement from the Finance Ministry. As previously announced by the government, EPF subscribers would receive an interest rate of 8.1% for 2021–2022 on their retirement savings accounts.
The Finance Ministry stated in a tweet that the subscribers' inability to view the interest credit was caused by a "software upgrade" to reflect changes to the taxes rules governing PF savings. The ministry tweeted: "No subscriber loses interest in any way. All EPF members' accounts are credited with the interest. However, due to a software upgrade that EPFO undertook to adjust for changes in the tax incidence, that is not apparent in the statements."
The Finance Ministry added in another tweet, "For all outgoing subscribers seeking settlement and for subscribers seeking withdrawal, the payments are being done inclusive of the interest.”
In response to a tweet from former Infosys Technologies director Mohandas Pai, the Finance Ministry clarified its position. Earlier, Mohandas Pai tweeted, "Dear EPFO, where is my interest?", along with the names of Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman, and the Prime Minister's Office.
“@narendramodi @PMOIndia We need reforms, sir! Why should citizens suffer as a result of inefficient bureaucracy? @DPIITGoI @FinMinIndia @nsitharaman @sanjeevsanyal, please help.”
How does EPFO calculate EPF Interest?
The EPFO determines the month-by-month ending balance and subsequently the interest for the entire year once the interest rate for a financial year is announced and the current year comes to a close. It is determined by multiplying the monthly running balance by the interest rate divided by twelve thousand
If a member is taking a final settlement and the interest rate for the current year has not been announced, interest will be credited based on the rate announced for the year that just passed. If any money is taken out within the current year, interest accrued from the start of the year to the last day of the month before the month the withdrawal occurred is taken into consideration.
According to EPFO, payments, whether they come in the form of a pension or a withdrawal benefit, are determined by the duration of service and the average wage at the time of leaving. The pension corpus receives 8.33% of the employer's 12% payment. The employee share and employer part of the provident fund are calculated separately in terms of interest.
