If you’re wondering how much pension you can expect to receive after retiring under the Employees’ Provident Fund (EPF) system in India, you’re not alone. The pension amount paid after retirement under EPF is governed by a scheme called the Employees’ Pension Scheme, or EPS-95. And as of 2025, there have been some significant and welcome changes to enhance pension benefits for retirees across the country.
What Exactly is the Pension Amount Under EPF (EPS-95) in 2025?
In simple terms, the EPS-95 scheme ensures that employees receive a monthly pension after they retire, provided they meet certain eligibility criteria. The biggest news for 2025 is the sharp increase in the minimum monthly pension amount. Previously, many pensioners were receiving a minimum pension of just Rs. 1,000 per month, which was quite insufficient given today’s rising costs of living. Thankfully, from around April-May 2025, the minimum monthly pension was raised to Rs. 7,500.
This increase is a game changer for over 6 million pensioners who depend on EPS-95 for financial security after retirement. The hike was planned to address inflation and help retirees maintain a decent standard of living. The funding for this uplift is borne jointly by the government and the Employees’ Provident Fund Organisation (EPFO), showing a strong commitment to pensioners’ welfare.
How Is the Pension Calculated Under EPS-95?
Now you might be wondering, “How is my pension calculated?” Well, the amount of pension you get isn’t arbitrary; it follows a clear formula:Pension=Pensionable Salary×Pensionable Service70Pension=70Pensionable Salary×Pensionable Service
Here, the pensionable salary is basically the average of your basic salary plus dearness allowance for the last 60 months (or 5 years) before you retire. Pensionable service is the number of years you have contributed to the EPS, with the minimum needed being 10 years. Note, the maximum salary considered for pension calculation is capped at Rs. 15,000 per month.
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What Are the Eligibility and Other Important Features?
To be eligible for the EPS pension, you generally need to have worked and contributed to the scheme for at least 10 years and have reached the retirement age, which is usually 58 years. You can choose to defer pension payments up to the age of 60, which gives you an additional 4% increase in your pension for each year you delay receiving it after 58.
Besides standard retirement pensions, the scheme also provides benefits to the family, such as widow/widower pensions and pensions for children, offering a safety net for your loved ones.
Why Is the Pension Increase So Important?
The increase to a minimum of Rs. 7,500 (plus dearness allowance linked to inflation) is more than just a number. It means real financial relief and dignity for retirees, especially those in low- and middle-income groups who have been struggling with the older, low pension payments. For many, this boost can make a major difference in managing healthcare, daily expenses, and inflation-driven price hikes.
With inflation-adjusted monthly payments, retirees can now look forward to a more stable and secure retirement, which finally respects the years of contributions they made while working.
