Indian rupee vs dollar
Indian rupee vs dollarReuters file

Subscribers to the Employees' Provident Fund Organisation (EPFO) will get 8.7 percent interest on their provident fund (PF) deposits for the financial year 2015-2016. The Indian finance ministry's proposed interest rate is lower than the one proposed by the apex decision-making body of the EPFO early this year.

"The CBT (Central Board of Trustees), at its meeting held in February 2016, has proposed an interim rate of interest at 8.8 per cent to be credited to the accounts of Employees' Provident Fund subscribers for 2015-16. The Ministry of Finance has, however, ratified an interest rate of 8.7 per cent," Labour Minister Bandaru Dattatreya said in a written reply to the Lok Sabha on Monday, reports PTI.

The CBT's move was criticised then, since it was lower than the 8.95 percent it had hinted was payable. 

In February, Dattatreya had promised that the 8.8 percent interest rate will also be the final one. 

"We will not revise it (interim interest rate) downwards. The revision will be keeping in view of the economic trend in the country, interest rates of various schemes as well as the 7th Pay Commission," Dattatreya had said, reported PTI.

The actual rate of interest paid in 2014-15 and in the previous financial year was 8.75 percent. 

There are over five crore subscribers to the EPFO. The total amount held with the EPFO was Rs. 6.34 lakh crore as on March 31, 2015, while contributions during 2015-16 stood at Rs. 1,01,000 crore (provisional). 

"As per the Audited Consolidated Annual Accounts of Employees' Provident Fund Organization (EPFO) for the year 2014-15, the closing balance of Funds managed by EPFO is Rs. 6,34,174.33 crore. The fresh accruals in 2015-16 in the three Schemes framed under the Employees' Provident Funds & Miscellaneous Provisions (EPF & MP) Act, 1952 as per the revised estimates is Rs. 1,01,538.54 crore," Dattatreya said in reply to a question in the Lok Sabha on Monday. 

Contributions under the Employees' Provident Funds (EPF) Scheme, 1952, stood at Rs. 71,398.25 crore, according to the labour minister.