More than 4 crore EPFO subscribers may get a lower interest at a rate of 8.6 per cent on their provident fund deposits for existing financial year since Labour Ministry may toe the Finance Ministry line to cut the rate.
EPFO had fixed 8.8 percent rate of interest on EPF deposits for 2015-16 notwithstanding Finance Ministry's approval for 8.7 percent.
"Finance Ministry has been nudging Labour Ministry to keep interest rate on EPF in line with other small savings schemes administered by it. There is a broad consensus between the two ministries to fix 8.6 per cent interest for this fiscal," a source was quoted as saying by news agency PTI.
He further said that the organisation has not worked out the income forecast for the present fiscal.
EPFO's apex decision making body , Central Board of Trustees (CBT), takes a call on interest rate on the basis of income forecast.
It fixes the rate of interest for a financial year and it is ratified by its advisory body Finance, Audit and Investment Committee (FAIC).
According to practice, Finance Ministry gives accord to the rate of interest fixed by the CBT seeing the income projections of a year.
After its approval, the interest rate is notified and credited into subscribers accounts.