The crucial meeting of the Central Board of Trustees will be held in New Delhi on Saturday to decide on the interest rate on Employees Provident Fund with CBT's sub-committee suggesting at least a 0.5 per cent cut.

With several subscribers eagerly awaiting the fate of their savings, CBT sources held that in all probability, the rate would be down by one per cent from the existing 9.5 per cent.

In its meeting held on May 22, the Finance and Investment sub-committee had recommended three rates of 8.0, 8.5 and 9.0 per cent interest.

According to the sub-panel's findings, only 8.0 and 8.5 per cent interest on EPF could earn them surplus, while with 9.0 per cent the fund will run into deficit.

With only two options left (either 8.5 or 8.0 per cent), the sources said CBT might go in for 8.5 per cent interest as they held that a drastic 1.5 per cent reduction would have wider political ramifications.

The fund could still earn a surplus of around Rs 218.98 crore (Rs 2.19 billion) if it went ahead with 100 basis points cut, they said, citing the sub-committee's findings.

Labour Minister and CBT chairman Sahib Singh Verma, who had earlier strongly favoured retaining 9.5 per cent, was 'silent' on the rates after the sub-committee's recommendations, they said.

Finance ministry sources were apprehensive of reported one per cent cut in EPF, saying it was unsustainable since in the last two years, there had been drastic cut in interest on Special Deposit Scheme, which comprises over 80 per cent of the EPFO corpus.