GPF interest rate for July-September reduced by 10 bps to 7.9 per cent
17 Jul 2019
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The government on Tuesday announced a 10 basis point reduction in the interest rate on the General Provident Fund (GPF) for the period starting 1 July and ending on 30 September.
This brings GPF interest rate on a par with the longer maturity Public Provident Fund (PPF) interest rate.
The government had earlier cut interest rates on some small savings schemes, including PPF and Senior Citizen Savings Scheme, by 10 basis points for the July-August quarter, amid a decline in overall interest rate in the financial system. For example, PPF for the July-September quarter will fetch 7.9 per cent interest rate (annual), as compared to 8 per cent in the previous quarter.
"Finance ministry has cut the rate of general provident fund (GPF) by 10 basis points from 8 per cent to 7.9 per cent effective from July 1," according to an official statement.
"During the year 2019-2020, accumulations at the credit of subscribers to the GPF and other similar funds shall carry interest at the rate of 7.9 per cent with effect from July 1, 2019 to 30th September 2019. This rate will be in force with effect from July 1, 2019," the statement added.
All government employees who joined service on or before December 31, 2003 contribute to GPF. An officer/employee contributes 6 per cent of his/her basic salary with an equal contribution from the Government.
Contributors to the GPF will now get 7.9 per cent interest on the contribution made during the July-September 2019-20 period.
The new interest rate will cover the General Provident Fund (Central Services), the Contributory Provident Fund (India), the All India Services Provident Fund, the State Railway Provident Fund, the General Provident Fund (Defence Services), the Indian Ordnance Department Provident Fund, the Indian Ordnance Factories Workmen’s Provident Fund, the Indian Naval Dockyard Workmen’s Provident Fund, the Defence Services Officers Provident Fund and the Armed Forces Personnel Provident Fund.
