EPFO board meeting today; retirement fund body likely to approve equity investment limit from 15% to 25%

Retirement fund body the Employees’ Provident Fund Organisation (EPFO) could take a call on increasing the equity investment limit from 15 per cent to 25 per cent in today’s board meeting. The EPFO is also likely to come out with new guidelines to invest in PSU and private companies. Zee Business’ Anurag Shah reports.

Currently, the EPFO is allowed to invest 15 per cent in equity while the remaining amount in debt instruments. The likley increase in equity will be done in two phases – from 15 per cent to 20 per cent in the first phase while from 20 per cent to 25 per cent in the next phase.

The current interest rate in all debt instruments in between 7-8 per cent. This is the reason why the interest rate for the financial year 2021-22 was 8.1 per cent lowest in 40 years.  

  On the other hand, the returns from equities have been to the tune of 14 per cent. If the EPFO raise its equity investment limit to 25 per cent, the EPF members will get higher interet rates.  

Board Meeting of EPFO today  

There could be an announcement related to the rules for investment in PSU and private companies.    

The limit of investment in equity ETF is likely to be increased from 15 per cent to 25 per cent.

The returns from G-Sec bonds not significant enough.

Can your EPF be attached to recover liabilities against you? 3 lesser-known facts about EPFO account

There are over 7 cr subscribers to the EPFO.