EPFO may offer 9 interest

The Employees Provident Fund Organisation EPFO is considering providing 9 per cent interest rate in 2011-12. Though lower than 9.5 per cent for 2010-11,it would still be higher than the 8.5 per cent rate prevailing earlier.

Interest savings of about Rs 400 crore that the EPFO has stopped paying on inoperative accounts and availability of about Rs 200 crore reserve funds will help the organisation offer 9 per cent on PF,said a source. We will not be able to match the 9.5 per cent interest rate,but we still want to give them as high a return as possible.

The EPFO has about three crore accounts that have not registered any activity and Rs 15,000 crore of unclaimed funds. As we have stopped paying interest on them,we will save Rs 400 crore, the source said. A final decision will be taken by the Central Board of Trustees,probably by August.