The Central Government has decided to keep the interest rates on General Provident Fund (GPF) and other related funds unchanged. According to a notification issued by the Finance Ministry, the interest rate on GPF for the third quarter of the financial year 2025-26 (October 1 to December 31, 2025) will remain at 7.1%. GPF is a mandatory savings scheme for central and state government employees that provides them financial security after retirement. Only government employees – those in permanent service in the Central or State Government – can join this scheme.
Employees deposit a certain portion of their salary (usually a minimum of 6 percent) into their GPF account every month. The government also pays interest on GPF, which is fixed every quarter. A notification is issued by the Department of Economic Affairs, Ministry of Finance. These rates are generally kept in line with the government’s small savings schemes to maintain interest rate balance.
Which funds are subject to this rate?
This 7.1 per cent interest rate applies not only to the General Provident Fund (GPF) but also to other related funds, including the Contributory Provident Fund (India), All India Services Provident Fund, State Railway Provident Fund, Defense Services Officers Provident Fund, and General Provident Fund (Defence Services). Like GPF, Public Provident Fund (PPF) is also a long-term savings scheme, but it is also available to common citizens. The current interest rate on PPF is 7.1 percent.
Meanwhile, the Employees’ Provident Fund (EPF) is for private sector employees, and its current interest rate is 8.25 percent (FY 2024-25). Investments in the National Pension System (NPS) are market linked, so returns are not certain, but they can give better returns in the long run.
No change in interest rates of small savings scheme
Recently, the government has not made any change in the interest rates of Small Savings Scheme for the October-December 2025 quarter. This includes schemes like PPF, Sukanya Samriddhi Yojana, Senior Citizen Savings Scheme and National Savings Certificate.
Why is GPF important?
General Provident Fund (GPF) is a scheme with secure and guaranteed returns for government employees. The amount deposited in this is completely safe and the interest is tax free. This scheme provides financial assistance to employees in the form of a lump sum after retirement.