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Tuesday, December 07, 2021

EPFO board meeting: FY22 rate, investment options likely in focus

The agenda of the meeting is yet to be circulated. The investment committee will meet before the Board meeting.

By: ENS Economic Bureau | New Delhi |
November 9, 2021 2:56:56 am
The EPFO has been providing an 8.5 per cent interest rate for the last two years.

Investment in alternative investment funds (AIFs), infrastructure investment trusts (InvITs) and other similar investment options, along with a likely discussion on the interest rate for 2021-22, are expected to be on the agenda of the next meeting of the Central Board of Trustees of the Employees’ Provident Fund Organisation (EPFO). The meeting is scheduled for November 20.

A board member said, “The Board will consider more secure investments such as government-linked InvITs, which will broaden the investment basket beyond exchange traded funds. Other options to tap into higher returns from the market would also be considered.” The CBT may also discuss the interest rate for the ongoing financial year based on the returns of its investments from the debt and equity market.

The EPFO has been providing an 8.5 per cent interest rate for the last two years. Despite being the lowest rate offered in the last eight years, the Finance Ministry has been nudging the retirement fund body for a lower rate.

In April, the Labour Ministry had notified changes in investment options to include units issued by Category I and Category II AIFs regulated by the Securities and Exchange Board of India (Sebi). The EPFO can invest up to 15 per cent of investment in equity as per the pattern of investment notified by the central government and the internal guidelines of the EPFO approved by the CBT. It had invested Rs 7,715 crore in equity till June 30 this year.

The agenda of the meeting is yet to be circulated. The investment committee will meet before the Board meeting.

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