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New Delhi15 hours ago
Nearly 60 lakh subscribers of the Employees Provident Fund Organization (EPFO) have not received interest money so far. While the government started paying interest for 2019-20 from 1 to one and a half months in advance. According to the EPFO, this delay in payment of interest is due to a mess in the KYC. This situation has arisen because the information given by the employee and employer (employer) does not match.
EPFO started paying 8.5% interest for the year 2019-20 from the beginning of this year. So far, interest amount has been routed to about 5 crore accounts. EPFO has a total of 60 million subscribers. Generally, the process of payment of interest is completed in 1 to 2 weeks.
EPFO institutionally pays interest
The EPFO pays interest institutionally and not on an individual basis. If the information of a single employee of the organization is not found correct, then the payment of interest to the employees of the entire organization is delayed. This year many organizations are taking time to pay due to this.
Interest had to be paid by 31 December
In September, the government had said to pay interest in two installments. 8.15% interest was to be paid under the first installment. The remaining 0.35% interest was to be paid by 31 December 2020.
Delay in giving the lowest rate of interest in 7 years
8.50% interest has been fixed on EPF for FY 2019-20. Which is the lowest in the last 7 years. 8.65% interest was paid on EPF or PF in FY 2018-19. How much interest was received in the year …
Interest is paid annually on deposits
According to the rules, it is mandatory for people receiving salary to contribute 12% of their salary and dearness allowance to the PF account. The employer also contributes the same to the employee’s PF account. However, the company’s share is divided into two parts. Of this, 8.33% goes to pension scheme. At the same time, the remaining part goes to the PF account. Interest is earned annually on the basis of compounding on the portion contributed to the PF account.