The retirement fund body EPFO on Thursday decided to provide 8.65 per cent interest on PF deposits for the financial year 2018-19 against 8.55 per cent in the last year to its 6 crore subscribers, Labour Minister Santosh Gangwar said. The development came after a Central Board of Trustees (CBT) meeting in the national capital this afternoon. The proposal would now go to the Finance Ministry for approval, Gangwar told reporters after the CBT meeting.
"Employees' Provident Fund Organisation has hiked interest rate on employees' provident fund to 8.65% from 8.55% for the 2018-19 fiscal year," the news agency ANI reported.
Employees' Provident Fund Organisation has hiked interest rate on employees' provident fund to 8.65% from 8.55% for the 2018-19 fiscal year. pic.twitter.com/sytjS2Ss0O— ANI (@ANI) February 21, 2019
Other important issues that came up for discussion in the CBT meeting include the appointment of new fund managers and review of investment made by the EPFO in Exchange-Traded Funds (ETFs).
Earlier, there were reports that the interest on EPF deposits for the subscribers of this fiscal could be more than 8.55 per cent keeping in mind the impending General Elections 2019 due by May.
The Central Board of Trustees (CBT) headed by Labour Minister, which finalises rate of interest on PF deposits for a financial year, is the apex decision-making body of the EPFO.
Once approved by the CBT, the proposal requires the concurrence of the Finance Ministry. The interest rate is credited into the subscribers account after the Finance Ministry's approval.
The EPFO had provided a five-year low rate of interest of 8.55 per cent to its subscribers for 2017-18. The body had kept the interest rate at 8.65 per cent in 2016-17 and 8.8 per cent in 2015-16. It provided 8.75 per cent interest for 2013-14 as well as 2014-15. The rate of interest was 8.5 per cent in 2012-13.
The EPFO had started investing in the ETFs in August 2016. Presently it invests 15 per cent of its Rs 1.5 crore investible deposits at hand every year in the ETFs. It has invested around Rs 50,000 crore in the ETFs so far.
(With inputs from agencies)