The Employees Provident Fund or EPF interest rate for 2022-23 is increased to 8.15%. For FY 2021-22, it was 8.1%. Hence, the increment of 0.05%. Let us look at the past 72 years’ history of EPF interest also.
EPF forms one of the most important parts of anyone’s retirement portfolio. It is also one of the attractive debt instruments as its a fixed, safe, and tax-free returns at retirement. Hence, many try to invest more along with the default option of EPF in the form of VPF.
Before proceeding further, first, let us understand how your EPF contribution is divided. I have written a detailed post in this regard earlier (Employee Provident Fund (EPF)-Changed rules from 1st Sept 2014“. However, I will again show you in detail about your and your employer’s EPF contribution being split.
Note:- Now the EDLI is raised from earlier Rs.3 lakh to Rs.7 Lakh (EDLI Scheme 2021 – EPF Life Insurance of Rs. 7 Lakh).
As I mentioned above, The Employees Provident Fund or EPF interest rate for 2022-23 is increased to 8.15%. For FY 2021-22, it was 8.1%. Hence, the increment of 0.05%.
However, let us look into the past 71 years’ interest rate movement of EPF.
If we look at the historical returns of EPF, in FY 1952-53, it was 3% and gradually increased and during FY 1977-78, it touched the 8% interest rate (which is around the current rate).
From FY 1978-79 to up to 1991-92 it continuously on an uptrend and first 40 years peak was 12%.
From 1992-93 to 1999-00, it was at its peak of 12%. Later on, it is lowering year on year and now it touched to 8.15% for FY 2022-23.
Let me share the historical EPF interest rate from 1952 to 2023.
| Year | EPF Interest Rate |
| 1952-53 | 3.00% |
| 1953-54 | 3.00% |
| 1954-55 | 3.00% |
| 1955-56 | 3.50% |
| 1956-57 | 3.50% |
| 1957-58 | 3.80% |
| 1958-59 | 3.80% |
| 1959-60 | 3.80% |
| 1960-61 | 3.80% |
| 1961-62 | 3.80% |
| 1962-63 | 3.80% |
| 1963-64 | 4.00% |
| 1964-65 | 4.30% |
| 1965-66 | 4.50% |
| 1966-67 | 4.80% |
| 1967-68 | 5.00% |
| 1968-69 | 5.30% |
| 1969-70 | 5.50% |
| 1970-71 | 5.70% |
| 1971-72 | 5.80% |
| 1972-73 | 6.00% |
| 1973-74 | 6.00% |
| 1974-75 | 6.50% |
| 1975-76 | 7.00% |
| 1976-77 | 7.50% |
| 1977-78 | 8.00% |
| 1978-79 | 8.30% |
| 1979-80 | 8.30% |
| 1980-81 | 8.30% |
| 1981-82 | 8.50% |
| 1982-83 | 8.80% |
| 1983-84 | 9.20% |
| 1984-85 | 9.90% |
| 1985-86 | 10.20% |
| 1986-87 | 11.00% |
| 1987-88 | 11.50% |
| 1988-89 | 11.80% |
| 1989-90 | 12.00% |
| 1990-91 | 12.00% |
| 1991-92 | 12.00% |
| 1992-93 | 12.00% |
| 1993-94 | 12.00% |
| 1994-95 | 12.00% |
| 1995-96 | 12.00% |
| 1996-97 | 12.00% |
| 1997-98 | 12.00% |
| 1998-99 | 12.00% |
| 1999-00 | 12.00% |
| 2000-01 | 11.00% |
| 2001-02 | 9.50% |
| 2002-03 | 9.50% |
| 2003-04 | 9.10% |
| 2004-05 | 9.50% |
| 2005-06 | 8.50% |
| 2006-07 | 8.50% |
| 2007-08 | 8.50% |
| 2008-09 | 8.50% |
| 2009-10 | 8.50% |
| 2010-11 | 9.50% |
| 2011-12 | 8.30% |
| 2012-13 | 8.50% |
| 2013-14 | 8.80% |
| 2014-15 | 8.80% |
| 2015-16 | 8.80% |
| 2016-17 | 8.70% |
| 2017-18 | 8.60% |
| 2018-19 | 8.70% |
| 2019-20 | 8.50% |
| 2020-21 | 8.50% |
| 2021-22 | 8.10% |
| 2022-23 | 8.15% |
If we draw the histogram chart of these 71 years’ data, then it looks like the below.
The majority of the time, the interest rate was within the range of 7.8% to 10.2%. Then the next highest was in the range of 3% to 5.4%.
Hence, the current interest rate change from the existing 8.5% to 8.1% is not new. However, yes it obviously hurts many salaried.
Let us check the EPF contribution history also.
If you check out the historical EPF contribution rate, it increased a lot from around 6.25% in 1956 to currently 12% of Basic+DA.
Conclusion – The current 8.15% is still better than any other available debt option. Hence, I strongly advocate EPF and VPF contributions, especially for retirement goal.
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View Comments
Sir,
I would like to get your clarification to the calculation of pension amount. I have contributed EPS95 for 24 years and 7 months from August 1998 to Feb. 2023. But my pension amount is Rs. 3,429 i.e. by deduction widow pension to my spouse Rs. 1,715 and Daughter's pension Rs. 429 till 25 years. My pensionable salary Rs. 14,834 x Pensionable Service 26.7 (24.7 + 2)/70 = Rs. 5,721
Please advise why Rs. 3,429 is fixed as my pension amount under EPS95?
Calculation of EPS95 as per PPO by EPFO, Madurai RO, Tamil Nadu:
(6,599 days x Rs.6,500)+(3,015 days x Rs. 14,834)/70 years x 365 Days = 25,550
= 87618010/25550
= Rs. 3,429/Month
Dear Joe,
I think they considered the basic wage for the 6,599 days rather than what you calculated. Why not you raise this issue directly with EPFO Grievance Cell Online?
Excellent Information. The interest rates of EPFO for FY 2021-22, FY 2022-23 are not yet credited. If I withdraw partial amount, will it incure loss for me.(Means, interest for last two years get credited for amount withdrawn or not) Could you suggest me, when can i proceed withdrawal, after interest credit or now.
Dear Senthil,
There will not be any loss. As they pay it on pro rata basis.
Thank you BasuNivesh!!
Hello BasuNivesh
NIce information. Thanks for consolidating and sharing it.
Also have you done calculations on EPS-95 higher pension? If yes, can you share the calculations to know how much additional money one has to pay to EPFO, beyond ? 1250 being deducted every month.
Dear Shantanu,
Thanks for your kind words. Regarding higher EPS, we can't generalize and assume that one size fits for all. Hence, I stayed away from writing a post on that aspect.
EXCELLENT INFORMATION FOR SALARY EARNERS.
Dear Vasabt,
Thanks.