EPFO Alert: EPFO ​​may increase the limit of investment in shares, trustees’ meeting expected to approve the proposal

The Employees’ Provident Fund Organization (EPFO) may approve a proposal to increase the investment limit in shares and related investment products from the existing 15 per cent to 20 per cent. The proposal is likely to be approved in the meeting of EPFO ​​trustees to be held on July 29 and 30.

The Employees’ Provident Fund Organization (EPFO) may approve a proposal to increase the investment limit in shares and related investment products from the existing 15 per cent to 20 per cent. The proposal is likely to be approved in the meeting of EPFO ​​trustees to be held on July 29 and 30. At present, the EPFO ​​can invest five per cent to 15 per cent of the investment eligible deposits in equity or equity related schemes.

Investment limit can be made up to 20%

The proposal to increase this limit to 20 per cent has been considered and approved by the Finance Audit and Investment Committee (FAIC) of EPFO. The recommendation of FAIC will be placed before the Central Board of Trustees (CBT), the apex decision making body of EPFO, for consideration and approval. According to a PTI report, the source said that the Central Board of Trustees, headed by the Union Labor Minister, may approve an increase in the investment limit in equity and equity related schemes of FAIC from the existing five to 15 per cent to 20 per cent.

In a written reply to a question in the Lok Sabha, Minister of State for Labor and Employment, Rameshwar Teli on Monday said that the FIAC, a sub-committee of the CBT, has recommended to consider raising the equity and equity related investment limit from 5-15 per cent to 5-20 per cent. .

Investment in

ETF

s was approved in August 2015

EPFO had approved investment in Exchange Traded Funds (ETFs) in August 2015. At that time, five per cent of investible deposits were invested in equity-linked products. For the current financial year, it has been increased to 15 percent.

Teli also said that EPFO’s return on equity related investments has increased to 16.27 per cent in 2021 from 14.67 per cent in 2020-21. However, trade unions have been opposing EPFO’s investment in the stock market. The reason for this is that there is no government guarantee on this investment.

Apart from this, let us tell you that in this meeting a decision can be taken regarding the formation of Central Pension Disbursal System. 73 lakh pensioners will get the benefit of this and pension can be transferred to everyone’s account simultaneously. At present EPFO ​​has 138 regional offices. All these offices give benefit to the beneficiaries in their pension account according to their own. In such a situation, pensioners get pension on different days and at different times.