Inactive EPF accounts to get interest from now onwards at 8.8%
POSTED BY ON November 7, 2016 COMMENTS (17)
Good news, the inactive EPF accounts will now start getting interest. Also the interest will be paid since Mar month of this year. This will start once the govt issues the notification regarding this. Since 2011, the EPF accounts which were not active for 3 yrs before inoperative EPF accounts and they stopped getting the interest.
Now Inoperative EPF accounts will earn interest
However now the rules are changed and if someone wants to keep the money in EPF account, they can do so. The EPF account will keep earning the interest decided by EPFO from time to time. This year itself the news was out that the inoperative accounts will get interest. However the notification news has come just now yesterday.
As per the EPF officials, Around 42,000 crore has been lying in inoperative EPF accounts and they will get interest @8.8% now.
“The inoperative EPF accounts are not being paid interest since 2011. As per the instructions given by Prime Minister Narendra Modi and Finance Minister Arun Jaitley, we decided to start paying interest on those accounts to make them operative,” Mr. Dattatreya said on Monday.
As per this latest development, now after you leave your job, and do not join somewhere else, you can leave the EPF account to keep earning the interest. Given that the EPF interest is upwards of 8%, it’s a good place to park the money.
Hi Manish,
Thanks for sharing the info regarding PPF. I have an active PPF account since 2011 and today i have download the PPF statement and it shows Interest rate 8.0 % p.a. How is this possible as far as i know PPF interest rate was never 8% from 2009 to till now. They why is it showing 8.0%. I have PPF in SBI. Though i have written a mail to branch manager and waiting for his reply.
Please help me what to do and who to connect for that issue.
Hi Niraj Kumar
I suggest that you now take the RTI route. You can file the RTI and ask your queries to them. THey are bound to reply you on your queries.
Its a bit long cut, but works well
Manish
“….you can leave the EPF account to keep earning the interest”
So how long can the EPF account be left like that after leaving a job? Is there a limit like 3 years or will it accumulate interest till I am 60?
You can keep it till 60
Thanks Manish. Given that the interest rate is good – is it a good idea to leave it inoperative till 60 or is there a downside that I am not seeing?
As of now , I dont see any downside for this, if you are ok with the rate of return and the uncertainity of seeing the changes in the rates every now and then
Is govt paying arrears interest from 2011 or only paying interest starting from 01.04.2016
Only since 2016
What about PPF account?
PPF account anyways gets interest
Thanks.
That interest rate, 8.8%, seems very good! Right now the United States has very low interest rates and people would LOVE to get that much interest. Banks here are paying less than 1%. I wonder if I should take some of my US dollars and move them to Indian currency to pick up some of these good interest rates.
One concern I have is that I just read that some bank notes are being discontinued due to black money. Is the currency stable? Thanks!
Thanks for sharing that PatientWealth
I haven’t withdrawn or transferred EPF from my previous 3 employers. What would happen in this scenario?
Nothing .. It will just earn interest and be active
Not sure if others are facing the same….the interest credited in one of my EPF accounts (with my previous employer) on 31032016 has been debited and not showing up now …. Is it due the fact that I changed employer and have another EPF account now ?
I am not sure on exactly what might be the issue. I suggest filing a RTI for this, as the correct answer will come from EPFO officials only