EPS-2026: The Central Government has offered a significant benefit to PF-covered employees by implementing a special scheme. The government rolled out EPS-2026 on June 29, introducing several major changes. This new scheme will replace the EPS-1995 and the Employees’ Family Pension Scheme, 1971.
Rules regarding pension calculation, contributions, and the minimum pension amount remain unchanged under this scheme. However, new regulations have been introduced concerning the timeframe for settling pension claims and the payment of interest in cases of delay. If you are not yet familiar with the new pension scheme, here are the details. We provide an overview of EPS-2026 below.
Key features of the new pension scheme
The government’s new pension scheme is set to be highly significant. While there haven’t been drastic alterations to the core structure, certain updates are important to note. The government has made it mandatory to settle pension claims within 20 days. Furthermore, if a delay occurs, employees must be paid interest at an annual rate of 12%. Additionally, rules regarding ‘higher pension’ have been officially incorporated into the scheme. A provision ensuring a minimum return of 8.5% on contributions has also been established. The scheme has been renamed the ‘Employees’ Pension Scheme, 2026′.
What remains unchanged?
There have been a few major changes under the government’s new pension scheme; several key aspects remain exactly as they were. Existing pensioners will continue to receive their benefits without interruption.
There have been no changes to the pension calculation formula; it remains the same as before. The method for calculating ‘pensionable salary’ also remains unchanged. Rules regarding contributions to EPF and EPS have been kept as they were. Similarly, the regulations concerning pension eligibility—specifically regarding leaving service before completing 10 years—remain unchanged. Additionally, there will be no increase in the minimum pension.
Interest earned in the 2025-26 financial year
It is worth noting that the Central Government has announced an interest rate of 8.25% for PF accounts for the 2025-26 financial year. This amount has not yet been credited to the accounts; the transfer of funds is expected to begin by the last week of July.
All PF subscribers are eagerly awaiting the credit of their funds into their accounts. They can easily check their balance through online platforms. An interest rate of 8.25% was provided for the 2024-25 financial year as well. Although there was a possibility of an interest rate hike this time, it did not materialise. The Central Government provides the annual interest amount to PF subscribers.
