EPFO Update: The EPFO Board meeting is going to be held on 29th and 30th July, 2022, in which approval can be given on the proposal to increase the existing limit of investment in the stock market and related products from 15 percent to 20 percent.
EPFO To Increase Investment In Equity: PF account holders can get great happiness. The EPF Board has recently reduced the EPF rate from 8.5 per cent to 8.1 per cent for the 2021-22 financial year, which is being heavily criticized. EPF is now planning to give higher returns to its investors. Actually, the EPFO board can take a decision on increasing the investment limit in the stock market.
Board can decide
It is worth noting that on July 29 and 30, 2022, the meeting of the EPFO board is going to be held in which the proposal to increase the existing limit of investment in the stock market and related products from 15 percent to 20 percent can be approved. If the EPF board takes this decision, then investors will get more returns than investing in the stock market.
Government can announce
In a written reply to a question in the Lok Sabha, Minister of State for Labor and Employment Rameshwar Teli said, “The FIAC, a sub-committee of the CBT, has recommended raising the equity and equity related investment limit from 5-15 per cent to 5-20 per cent.” However, let us tell you that trade unions have been opposing the increase in the investment limits of EPFO in the stock market. The government believes that there is no government guarantee on this investment, due to which investors may have to suffer losses.
Up to 20 percent investment in equity possible
Significantly, the Finance Investment and Audit Committee of EPFO has approved the proposal to increase the limit of investment in the stock market to 20 percent. At present, the EPFO invests only 5 to 15 per cent of its funds through Exchange Traded Funds (ETFs). Actually, this time EPFO has got a return of 16.27 percent in 2021-22 from investment in equity, which was 14.67 percent in 2020-21. EPFO has invested in Nuclear Power Bonds for 15 years, on which an interest of 6.89 percent will be paid annually. At present, interest from 7.27 percent to 7.57 percent is being available on Central Government and State Government bonds. Obviously, EPFO is getting low returns on investment in government bonds to corporate bonds.
