The government slashed interest rate on General Provident Fund (GPF) by 10 basis points or 0.1 per cent to 7.9 per cent. The revised rate is applicable for quarter ending on September 30, Department of Economic Affairs’ said in a statement. A government employee becomes a member of GPF by contributing a certain percentage of his/her salary to the account. As per GPF rules, all temporary government servants after a continuous service of one year, all re-employed pensioners (other than those eligible for admission to the contributory provident fund) and all permanent government servants are eligible to subscribe to GPF, as mentioned on pensionersportal.gov.in.
Here are 5 things to know about General Provident Fund (GPF):
- A subscriber is required to make monthly contributions towards GPF except during the period when he or she is under suspension.
- Subscriptions to the general provident fund are stopped three months prior to the date of superannuation.
- A subscriber, at the time of joining the General Provident Fund (GPF) is required to make a nomination, conferring on one or more persons the right to receive the amount that may stand to his credit in the fund in the event of his death, before that amount has become payable or having become payable has not been paid, according to pensionersportal.gov.in.
- For withdrawal from GPF, no documentary proof is required to be furnished by the subscriber. On retirement of a subscriber, instructions are issued for immediate payment of the final balance on retirement.
- On the death of a subscriber, the person entitled to receive the amount standing to the credit of the subscriber is paid an additional amount equal to the average balance in the account during the three years immediately preceding the death of the subscriber, subject to certain conditions provided in the relevant rule. The additional amount payable under that rule shall not exceed Rs. 60,000. However, to get this benefit, the subscriber should have put in at least 5 years of service at the time of his/her death, according to Provident Fund’s website.