EPFO approves 8.25% interest rate for 2025 26

In a bonanza to subscribers, the Employees’ Provident Fund Organisation on Monday announced an interest rate of 8.25% for provident fund deposits for 2025-26. This is the third consecutive year when EPFO members will earn 8.25% interest on their retirement savings.

The decision was taken at a meeting of the Central Board of Trustees of the EPFO. “EPFO has been able to declare an interest rate of above 8% for the past several years owing to good returns given by ETF and other investments. The decision reflects the strong credit profile of EPFO’s investment portfolio and its sustained ability to deliver competitive returns to its members,” said an official release by the ministry of labour and employment after the meeting.

The interest rate would be officially notified by the Government of India, following which EPFO would credit the interest into the subscribers’ account.

In another significant relief to subscribers, the CBT chaired by Union Labour and Employment Minister Mansukh Mandaviya also approved a pilot project for auto-initiation of claim settlement in inoperative EPFO accounts. For now, this would be for inoperative accounts with unclaimed balances of Rs 1,000 or less.

In the first phase, around 133,000 such accounts, amounting to nearly Rs 5.68 crore will be covered under this initiative. “The amounts will be directly credited to members’ Aadhaar-seeded and EPFO-linked bank accounts without requiring fresh claims or documentation, significantly simplifying the process and helping members receive their dues faster,” the ministry said.

Based on the success of the pilot, the facility will be extended in subsequent phases to accounts with balances above Rs 1,000, further strengthening member-centric reforms in EPFO. “This initiative will facilitate faster credit of long-pending balances to members, reduce procedural delays, improve data accuracy, and further enhance ease of access and service delivery for EPFO members,” it said.

Transfers and claim settlements of inoperative accounts have been a huge pain point for subscribers.

The CBT also approved the notification of new social security schemes to align with the Code on Social Security, 2020 to ensure seamless transition from the existing framework. The newly approved Employees’ Provident Fund Scheme, 2026, Employees’ Pension Scheme, 2026 and Employees’ Deposit Linked Insurance (EDLI) Scheme, 2026 will replace the current schemes and provide a legally robust foundation for administering provident fund, pension and insurance benefits.