For millions of working people, Provident Fund (PF) is a major support for their future savings. Every year employees are curious to know when the interest will come on their PF account and how much benefit they will get. Recently the Central Board of Trustees of the Employees Provident Fund Organization (EPFO) has decided to give 8.25% interest on EPF deposits for the financial year 2025-26. After this, the question is arising in the minds of the employees that by when will this interest come to their account and how is it calculated.
EPF interest does not come on any fixed date. For this a process is completed. First of all, the Central Board of Trustees of EPFO decides the interest rate for the year. After this this decision is sent to the Central Government for approval. Only when the government gives final approval, the interest is transferred to the PF accounts of the employees. At present the first phase of determining the interest rate has been completed. Based on the experience of previous years, it may take 2 to 3 months to get the final approval and interest credit. Sometimes this process continues till July or August and the interest does not accrue simultaneously in all the accounts.
How is EPF interest calculated?
As per the rules of EPF scheme, interest is calculated on the basis of monthly running balance. This means that interest is calculated keeping in mind the amount present in the account and the changes in it throughout the year.
1. Full year’s interest on last year’s balance
If the balance in your account at the end of the last financial year, you get interest for full 12 months. But if you withdraw some money in between, the interest is calculated by deducting that amount.
2. Limited period interest on money withdrawn midway
If you have withdrawn money from PF during the year, then interest on that amount is available only till the month preceding the withdrawal.
3. Interest on new deposited amount from next month
If new money is deposited in your account during the year, interest on it is paid from the 1st of the month following the month of deposit till 31st March.
4. Interest amount is rounded off
At the end of the year the total interest amount is rounded off to the nearest whole rupee.
Why is it beneficial for employees
The interest received on EPF is considered better than ordinary savings schemes. This is the reason why it has become an important means of long-term safe savings for employed people.
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