Interest on GPF – New Pay Commission Updates

GPF Interest @ 8% from 1st April 2019 to 30th June 2019 – Finmin Orders

(PUBLISHED IN PART I SECTION 1 OF GAZETTE OF INDIA)
F.No.5(2)-B(PD)/2019
Government of India
Ministry of Finance
Department of Economic Affairs
(Budget Division)

New Delhi, the 3rd April, 2019

RESOLUTION

It is announced for general information that during the year 2019-2020, accumulations at the credit of subscribers to the General Provident Fund and other similar funds shall carry interest at the rate of 8% (Eight percent) w.e.f. 1st April, 2019 to 30th June, 2019. This rate will be in force w.e.f. 1st April, 2019. The funds concerned are:

1. The General Provident Fund (Central Services).
2. The Contributory Provident Fund (India).
3. The All India Services Provident Fund.
4. The State Railway Provident Fund.
5. The General Provident Fund (Defence Services).
6. The Indian Ordnance Department Provident Fund.
7. The Indian Ordnance Factories Workmen’s Provident Fund.
8. The Indian Naval Dockyard Workmen’s Provident Fund.
9. The Defence Services Officers Provident Fund.
10. The Armed Forces Personnel Provident Fund.

2. Ordered that the Resolution be published in Gazette of India.

sd/-
(Akhilesh Kumar Mishra)
Director (Budget)

To,
The Manager, (Technical Branch)
Government of India Press, Mayapuri, Delhi.

F.No.5(2)-B(PD)/2019
Copy forwarded to all Ministries/Departments of Government of India, President’s Secretariat, Vice-President’s Secretariat, Prime Minister’s Office, Lok Sabha Secretariat, Rajya Sabha Secretariat, Cabinet Secretariat, Union Public Service Commission, Supreme Court, Election Commission and NITI Aayog.

How to Calculate Interest for General Provident Fund

[Interest = Progressive Balance x Rate of Interest Divided by 100 x Months]

General Provident Fund : Needless to say that one of the easiest and good return saving scheme for Central Government Employees who have been appointed on or before 31.12.2003.

They can save not less than 6% from the total emoluments. As per the GPF Rules, subscriptions may be increased twice and/or reduced once at any time during the year.

Interest rates are announced by the Central Government from time to time, it has now been reduced from 8.8% to 8.7% for the current year.

GPF calculation Illustration –1 :-
Monthly subscription Rs.5,000
Rate of Interest 8.8%

Month	Subscription	Withdrawal	Progressive Balance	Interest for Year
Apr-12	5,000	–	5,000	–
May-12	5,000	–	10,000	–
Jun-12	5,000	–	15,000	–
Jul-12	5,000	–	20,000	–
Aug-12	5,000	–	25,000	–
Sep-12	5,000	–	30,000	–
Oct-12	5,000	–	35,000	–
Nov-12	5,000	–	40,000	–
Dec-12	5,000	–	45,000	–
Jan-13	5,000	–	50,000	–
Feb-13	5,000	–	55,000	–
Mar-13	5,000	–	60,000	–
	60,000	–	3,90,000	2860

Calculation of interest = 390000 / 12 x 8.8 / 100 = 2860
Closing balance as on 31.3.2013 will be = 60,000 + 2,860 = 62,860
GPF calculation Illustration –2 :- Closing balance Rs.1,80,000
Monthly subscription Rs.10,000
Rate of Interest 8.8%
Taken as final withdrawn Rs.1,80,000 during November, 2012

Month	Subscription	Withdrawal	Progressive Balance	Interest for Year
Apr-12	10,000	–	1,90,000	–
May-12	10,000	–	2,00,000	–
Jun-12	10,000	–	2,10,000	–
Jul-12	10,000	–	2,20,000	–
Aug-12	10,000	–	2,30,000	–
Sep-12	10,000	–	2,40,000	–
Oct-12	10,000	–	2,50,000	–
Nov-12	10,000	1,80,000	80,000	–
Dec-12	10,000	–	90,000	–
Jan-13	10,000	–	1,00,000	–
Feb-13	10,000	–	1,10,000	–
Mar-13	10,000	–	1,20,000	–
	1,20,000	1,80,000	20,40,000	14,960

Calculation of interest = 2040000 / 12 x 8.8 / 100 = 14960
Closing balance as on 31.3.2013 will be = 1,20,000 + 14,960 = 1,34,960.

Check the Rate of Interest for General Provident Fund (GPF)