New Delhi, February 21: The Employees' Provident Fund Organisation (EPFO) has increased the interest rate it offers on deposits from 8.55 per cent 8.65 per cent. The significant hike comes days after the commencement of Lok Sabha elections 2019. The move is likely to instill confidence among the middle class section of the ruling party's supporters.

The decision to increase the EPFO rate -- after plunging it to a five-year low in 2017-18 -- was finalised at the Central Board of Trustees (CBT) meeting headed by Labour Minister Santosh Gangwar. The proposed rate requires the concurrence of the Finance Ministry, before being credited into the PF accounts of depositors. PM Modi Refutes Unemployment Charge, Says Over 70 Lakh Jobs Created in Formal Sector Last Year.

In 2017-18, the government had lowered the interest rate vis-a-vis the previous fiscal. From 8.65 per cent, which was offered to depositors for the year 2016-17, it was brought to 8.55 per cent. The highest interest rate provided under the incumbent government was in 2015-16, when the Labour Ministry had increased it to 8.8 per cent.

EPFO Hikes Interest Rate on Deposits For FY18-19:

The hike in interest rate also comes in the backdrop of a sharp increase in EPF enrollments in the last two fiscals. More than 1 crore members have been added to the EPFO in the last two years, Labour Minister Santosh Kumar Gangwar had recently told news agency PTI.

Gangwar said it is the constant endeavour of the government to bring more workers in the unorganised sector under the fold of EPFO.

(The above story first appeared on LatestLY on Feb 21, 2019 05:07 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).