The federal government has cut the General Provident Fund’s interest rate to 12.05% for 2025-26, marking a decline from the previous year’s 12.46%, impacting government employees’ savings amidst regional adjustments.
The federal government has reduced the return on the General Provident Fund for financial year 2025-26, setting the mark-up at 12.05%, according to a notification from the Ministry of Finance. The revised rate takes effect from July 1, 2025 and is lower than the 12.46% announced for 2024-25. That leaves government employees with a 0.41 percentage point cut in the annual return on their savings.
The General Provident Fund is a compulsory savings scheme for government staff, with the profit rate determined by the federal government rather than by market forces. In practice, that means the return can be adjusted each year in line with official policy. The latest notification confirms that the lower rate will apply across the current financial year.
Elsewhere in the region, provident-fund rates have also been subject to periodic revision. In India, official notifications have kept the General Provident Fund at 7.1% for part of 2025-26, while the Employees’ Provident Fund Organisation has approved 8.25% for EPF member accounts for the same financial year. Those separate announcements underline how state-backed retirement savings schemes are regularly reset to reflect broader fiscal decisions.
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