The interest rates on employees provident deposits are expected to remain at 8.5 percent for the financial year 2009-10.

Quoting an EPFO official, "The Employees' Provident Fund Organisation is in a position to maintain 8.5 per cent interest rate for 2009-10. The Central Board of Trustee (advisory body) is likely to take a call on the matter next month."

Commenting on the effect of this level of interest rates on the financial health of the organisation, the official affirmed, "the EPFO would have a surplus of Rs 6.4 crore during 2009-10."

The official reasoned that even a small increase of 0.25 percent (in the current fiscal) will lead to a deficit of Rs 366.77 crore. More so, at rate of 9 percent, the losses would accumulate up to Rs 739.94 crore.

The Employees' Provident Fund Organisation has about 4.49 crore provident fund subscribers and is one of the largest PF institutions in world, in the terms of constituent members and transactions handled.

The expected income of the organisation during FY 09/10 is Rs 12,994 crore.

Earlier the organization revealed that PF withdrawals have increased by nearly 32 percent during the financial year 2008-09 as against the 10 percent increase during the previous year, reasoned as the effect of economic downturn.