GP Fund Interest Rates 2020-21 Pakistan

Government of the Pakistan, Finance Department has issued the official Notification letter on 12th August, 2021 in connection with GP fund interest rates 2020-21 for the Federal Government Employees.

According to the letter the revised Rate of Mark-up on state Provident fund i.e. General Provident fund for the Fiscal year 2020-2021 are as under:

GP Fund Interest Rates 2020-21

I am directed to convey that the rate of mark-up on State Provident i.e. general provident Fund (GP Fund) for the fiscal year 2019-2020 is as under:-

Chart of GP Fund Interest Rates 2021

S.No. Fiscal Year Rate of Mark-up
1 2018-2019 14.35%
2 2019-2020 12.00%
3 2020-2021 07.90%

It has been decided to fix the GP fund interest rates upto 07.90% profit rate per annum will apply during the financial year 2020-21 to the state Provident Fund i.e. General Provident Fund.

GP Fund Rates History:

These rates of GP Fund Interest 2021-22 are the lowest since 1972. These rates are the lowest after 1972-73. These rates were between 3% and 7.25% before 1972-73. In 1997-98, the highest rate of GP Fund in Pakistan’s history was 22.763. For the same evidence, you can see the GP Fund Interest Rates since 1954.

The rates of markup rose initially, reaching a peak of over 22%. They dropped significantly this year. This notification will make employees unhappy if they are receiving interest in their General Provident Fund.

Where Can Employees Use GP Fund Markup:

We can use the recently announced marks-up for many purposes. These rates can be used for the following purposes:

  • Calculation of GP Fund Interest for GP Fund Subscription
  • Calculation of the Interest on Motorcycle Advance/Motorcar Advance
  • To calculate interest on a house building advance

Subscription to GP Funds Interest

The Accounts Office subtracts the GP Fund amount each month from the pay bills. These rates apply to the GP Fund subscription that was made until June 2021. This rate will not apply to employees who have an Interest-Free GP Fund. This category of employees gets Interest Free Loan of House Building Advance, Motorcycle/Motorcar Advance. Non-gazetted employees do not pay interest on their HBA.

Calculate interest on a house building advance

Non-gazetted employees or employees who do not get interest on GP Fund will be required to pay no Interest on HBA. They will receive an interest-free House Building Advance.

Gazetted employees, and employees who earn interest on their GP Fund, will be required to pay interest on HBA. The HBA rate for employees who received HBA from 1st July 2020 through 30th June 2021 is 7.90.

Calculation of the Interest on Motorcycle Advance/Motorcar Advance

Employees who receive mark-up on the GP Fund will be required to pay interest on motorcar or motorcycle advances. These rates will use to calculate the Interest of Motorcycle Advance / Motorcar Advance. These advances will be paid interest at 7.90% to employees who received them between 1st July 2020 and 30th June 2021.


GP Fund Interest Rates 2020-21 Pakistan

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