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What is the main objective of the General Provident Fund (GPF) scheme in India?
- a)To provide pension rights to retired private sector employees
- b)To encourage savings among government employees for retirement
- c)To offer financial assistance to unemployed individuals
- d)To support charitable organizations in the country
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
What is the main objective of the General Provident Fund (GPF) scheme...
The primary goal of the General Provident Fund (GPF) scheme in India is to encourage government employees to save a portion of their salary for their retirement. It ensures a reliable source of income for government employees after they retire, thereby promoting financial security in their post-employment years. By contributing a specified percentage of their salary to the GPF, employees build up savings that are paid out to them upon retirement, providing a financial cushion for their future.
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What is the main objective of the General Provident Fund (GPF) scheme...
Main Objective of the General Provident Fund (GPF) Scheme
The General Provident Fund (GPF) scheme is a significant savings tool for government employees in India, primarily aimed at promoting financial security for their retirement.
Encouragement of Savings
- The GPF encourages systematic savings among government employees, ensuring that they accumulate a considerable corpus over their service period.
- By mandating monthly contributions from their salaries, employees develop a disciplined approach to saving, which is crucial for financial stability.
Retirement Security
- The primary objective of the GPF is to provide a safety net for employees upon retirement. Upon retirement, employees can withdraw the accumulated funds, which can serve as a pension substitute or a financial cushion.
- This feature ensures that government employees can maintain a standard of living post-retirement, reducing their reliance on other pension schemes or government support.
Tax Benefits
- Contributions to the GPF are eligible for tax deductions under Section 80C of the Income Tax Act, promoting additional savings among employees.
- The interest earned on GPF savings is tax-free, further enhancing the appeal of the scheme as a retirement planning tool.
Conclusion
In summary, the General Provident Fund scheme primarily serves to encourage savings among government employees for their retirement, equipping them with financial independence and security in their post-working years. This makes option 'B' the correct answer, as it encapsulates the fundamental aim of the GPF.
The General Provident Fund (GPF) scheme is a significant savings tool for government employees in India, primarily aimed at promoting financial security for their retirement.
Encouragement of Savings
- The GPF encourages systematic savings among government employees, ensuring that they accumulate a considerable corpus over their service period.
- By mandating monthly contributions from their salaries, employees develop a disciplined approach to saving, which is crucial for financial stability.
Retirement Security
- The primary objective of the GPF is to provide a safety net for employees upon retirement. Upon retirement, employees can withdraw the accumulated funds, which can serve as a pension substitute or a financial cushion.
- This feature ensures that government employees can maintain a standard of living post-retirement, reducing their reliance on other pension schemes or government support.
Tax Benefits
- Contributions to the GPF are eligible for tax deductions under Section 80C of the Income Tax Act, promoting additional savings among employees.
- The interest earned on GPF savings is tax-free, further enhancing the appeal of the scheme as a retirement planning tool.
Conclusion
In summary, the General Provident Fund scheme primarily serves to encourage savings among government employees for their retirement, equipping them with financial independence and security in their post-working years. This makes option 'B' the correct answer, as it encapsulates the fundamental aim of the GPF.
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What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer?
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What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer?.
What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer?.
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What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer?, a detailed solution for What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? has been provided alongside types of What is the main objective of the General Provident Fund (GPF) scheme in India?a)To provide pension rights to retired private sector employeesb)To encourage savings among government employees for retirementc)To offer financial assistance to unemployed individualsd)To support charitable organizations in the countryCorrect answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
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