In a move that is expected to provide benefit to millions of EPF account holders in the country, the board of trustees of retirement fund body – EPFO has announced payment of interest on inactive accounts from April 1 this year.
As per reports, these inactive accounts have deposits of over Rs. 32,000 crore.
The decision was taken at a meeting of central board of trustees chaired by labour minister Bandaru Dattatreya.
Labour minister criticised the former UPA government for withdrawing the interest payments on inoperative EPF accounts.
“UPA government stopped interest on inoperative accounts.Now we have taken a pro-worker decision. The UPA government which was claiming to be a pro-worker, stopped the interest on inoperative accounts. We have decided to credit interest in inoperative accounts. There will not be any inoperative accounts,” Dattatreya was quoted as saying in local news reports.
Bandaru Dattatreya also informed that interest on deposits in inoperative accounts will be credited from from April 1 this year.
Inoperative accounts are those wherein the contribution has not been received for 36 months.
EPFO had stopped payment of interest to such accounts from April 1, 2011. The move was aimed at discouraging parking of funds with EPFO in these dormant accounts.
The decision will benefit over nine crore such account holders having total deposit of around Rs 32,000 crore.