New Delhi.
The Central Government has not made any change in the interest rates on General Provident Fund ‘GPF’ for the quarter ‘1 January to 31 March’ 2025. Interest rates have been stuck at the same point for the last six years. This is being said to be a big blow for the central employees.
The Department of Economic Affairs of the Finance Ministry has announced the interest rates on GPF last week. It has been said that the interest rate for this quarter also will remain 7.1 percent. Earlier also in the quarter ‘1 October to 31 December’ 2024, the interest rate of GPF was 7.1 percent.
Change in interest rates was expected from the government
The Department of Economic Affairs of the Finance Ministry had announced the interest rates for the General Provident Fund and other similar provident funds during the quarter ‘October 1 to December 31’. At that time the interest rate was kept at 7.1 percent. In the new year, government employees were expecting changes in the rates of General Provident Fund from the NDA government, but the Finance Ministry has not made any change in the interest rates. Interest rates have been kept stable for a long time.
Rates were not increased even during Corona
During the year 2021-22, the interest rate given on the total deposits of subscribers of General Provident Fund and other similar funds was kept at 7.1 percent from July 1, 2021 to September 2021. In the resolution issued by the Department of Economic Affairs on April 19, 2021, the interest rate on the amount of General Provident Fund was fixed at 7.1 percent. At that time the second wave of Corona had wreaked havoc in the country. Then dearness allowance of central employees was also stopped for 18 months. For this reason, the employees were hopeful that the government would increase the interest rates on the ‘GPF’ amount, but nothing like this could happen. From July 1, 2020 to September 30, 2020, the interest rate on GPF was kept at 7.1 percent.
Rates apply in these departments
These rates are General Provident Fund (Central Services), Contributory Provident Fund (India), All India Services Provident Fund, State Railway Provident Fund (Defence Services), Indian Ordnance Department Provident Fund, Indian Ordnance Factory Workers Provident Fund, Indian Naval Dock Workers Provident Fund. Fund, applies to Defense Services Officers Provident Fund and Armed Forces Personnel Provident Fund. Employees get higher interest on the amount deposited in GPF as compared to banks, hence many employees increase their share. More salary was deducted in GPF so that the employees could use it in times of great need.
Now the annual contribution limit is fixed at Rs 5 lakh
Employees can withdraw 90 percent of their GPF amount. However, the terms and conditions regarding this keep changing. GPF amount is useful in matters like children’s education, marriage, building a house or buying a plot for it, buying a flat, repairing the ancestral house and repaying the house loan. Three years ago, the Central Government had fixed the limit of annual contribution to the General Provident Fund at Rs 5 lakh in a financial year. According to the new provision, the total amount deposited in the GPF account in a financial year cannot exceed Rs 5 lakh.
