PSUs expecting to draw funds from EPFO

India Infoline News Service | Mumbai | January 11, 2017 08:44 IST

EPFO (Employees Provident Fund Organisation) will have to rethink its strategy of the investment pattern to give better interest rate to its subscribers, as we have seen a trend of drop in interest rates by banks. The subscribers in 2014-15 and 2015-16 got an interest rate of 8.80% on their provident fund savings. For this year i.e. 2016-2017 the interest rate will be 8.65%.

EPFO (Employees Provident Fund Organisation) will have to rethink its strategy of the investment pattern to give better interest rate to its subscribers, as we have seen a trend of drop in interest rates by banks.

The subscribers in 2014-15 and 2015-16 got an interest rate of 8.80% on their provident fund savings. For this year i.e. 2016-2017 the interest rate will be 8.65%. 

Currently, EPFO can invest upto 20% of its investable amount, which is around Rs 1.3 lakh crore this year in the state owned PSUs (Public Sector Undertakings) and also the ministry is planning to hike it by 10%.

EPFO which currently has huge cash pile, is being eyed by PSUs for funds from them. Indian Oil Corporation Limited, Coal India Limited, ONGC Limited, Bharat Electronics, Engineers India Limited, Power Finance Corporation and Rural Electrification Limited are the PSUs which have come forward and need the funds from EPFO.

A new investment pattern for EPFO was given by the Finance Ministry in 2015, allowing investments of 5% minimum, and upto 15% of its fund in equity, or schemes related to equity.

Following this, the EPFO had started investing upto 5% of its investable deposits in ETFs in August 2015. EPFO's amount investable is around Rs 1.3 lakh crore and it manages a corpus of about Rs 8 lakh crore. 
 

Advertisements

  • FREE Demat A/c + Rs.2000 Cashback ...Click here
  • Now get IIFL Personal Loan in just 8* hours...APPLY NOW!
  • Get the most detailed result analysis on the web - Real Fast!
  • Actionable & Award-Winning Research on 500 Listed Indian Companies.