At the start of each quarter of the FY, the government revises the interest rate on small savings schemes and subsequently declares the rate on GPF and other schemes.
The benefits will be for all organizations registered with the EPFO.
The government has declared interest rate on General Provident Fund and other similar funds for the October – December quarter. The Budget Division of Department of Economic Affairs, under the Ministry of Finance, has recently issued the notification that the fund accumulation at the credit of subscribers of General Provident Fund (GPF) and other similar funds will carry an interest rate of 7.1 per cent for the period October to December 2020. Therefore, the GPF interest rate from October 2020 to December 2020 is 7.1 per cent.
At the start of each quarter of the financial year, the government revises the interest rate on small savings schemes and subsequently declares the rate on GPF and other schemes.
Earlier, the interest rate for the post office small savings products such as Public Provident Fund (PPF), NSC etc were kept constant for the quarter October to December 2020. Currently, the interest rate on PPF is 7.1 per cent per annum compounded annually.
As per the website of The Ministry of Personnel, Public Grievances and Pensions, the General Provident Fund (Central Services) Rules 1960 applies to all temporary government employees after a continuous service of one year, all re-employed pensioners (other than those eligible for admission to the Contributory Provident Fund ) and all permanent government employees.
Contributory Provident Fund Rules (India ), 1962 is applicable to every non-pensionable servant of the Government belonging to any of the services under the control of the President. The Rules provide for the withdrawal of advances or withdrawals from the CPF for specific purposes. As in GPF Rules, the CPF Rules also provide for Deposit Linked Insurance Revised Scheme.
The interest rate of 7.1 per cent for the period October to December 2020, effective October 1, will apply to all the following funds:
1. The General Provident Fund (Central Services). 2. The Contributory Provident Fund (India). 3. The All India Services Provident Fund. 4. The State Railway Provident Fund. 5. The General Provident Fund (Defence Services). 6. The Indian Ordnance Department Provident Fund. 7. The Indian Ordnance Factories Workmen’s Provident Fund. 8. The Indian Naval Dockyard Workmen’s Provident Fund. 9. The Defence Services Officers Provident Fund. 10. The Armed Forces Personnel Provident Fund
The Department of Pension & Pensioners’ Welfare of the Ministry of Personnel, Public Grievances & Pension has been receiving grievances from retired government servants for inaccurate and delayed GPF settlement, along with interest, on their retirement, due to frequent instances of missing credits in their GPF accounts.
The missing credits in General Provident Fund (GPF) were reported mostly by subscribers in their GPF statements, who during their service moved from one establishment to another or were assigned foreign deputation and also by officers of All India Service, who proceeded on deputation outside their cadres.
The Department observed that the GPF account is maintained by an establishment different from that generating their salary bills and deducting their GPF subscription.
Therefore, the Department states that a co-ordination mechanism between such two establishments is most crucial to avoid any lapses in updated maintenance of GPF accounts.
Earlier in 2020, the Department had issued an Office Memorandum (OM) taking the following steps:
In order to avoid such grievances and for the sake of greater transparency, it has henceforth been decided that,
A) it shall be mandatory for all offices maintaining GPF Accounts to intimate the particulars of missing credits, once every financial year, to the authority responsible for deducting the GPF subscription, under intimation to the concerned subscriber.
B) A complete statement of all credits, debits and interest, since the inception of the GPF account, shall be provided to every subscriber, mandatorily two years before his date of retirement and thereafter one year before the date of retirement. Any subscriber can make a representation on such a statement provided to him and the office maintaining the GPF account shall resolve the grievance within 60 days from the date of receipt of such a grievance.