- The Employees' Provident Fund Organisation (EPFO) may reportedly raise interest rates from the current level at 8.55%, but if not, the current interest rates will not be narrowed further.
- According to A Mint report, the retirement body reportedly earned a surplus of nearly ₹6 billion at the existing interest rates in 2018.
- On an average, the interest rate of Public Provident Fund and the National Savings Certificate in 2018 was recorded to be 7.7%, said the report.
India’s Employees' Provident Fund Organisation (EPFO) may reportedly
raise interest rates from the current level at 8.55%, move likely to benefit over 60 million employees across different industries.
Though the rates are expected to go higher, but if not, the current interest rates will not be narrowed further, Mint reported citing a member of EPFO's central board of trustees. Even if the current interest rates follow, it will be a favourable decision for the salaried employees.
The interest rates are floated by the EPFO in December every year. However, this year, it will be declared on 1 February because of the ongoing audit. On average, the interest rate of Public Provident Fund and the National Savings Certificate in 2018 was recorded to be 7.7%, said the report.
The Indian government recently made amendments in its regulations covering its retirement schemes — including directives of making tax-free withdrawals available to employees under National Pension System (NPS) and boosting the incentives to around 50% for health workers. The new interest rates will likely be in check with such announcements.
According to the report, EPFO, which manages savings of over ₹11 trillion, reportedly earned a surplus of nearly ₹6 billion at the existing interest rates in 2018. If required, EPFO may use its equity investments, which have an estimated return of around 12% annually. Presently, it has invested over ₹500 billion in stock market.
See also:The Indian government has reportedly invested just 19% of its fund dedicated to boosting startupsThe Indian government is looking at policing online content on social media including breaking end-to-end encryption: ReportThe Indian government may roll back a tax on angel investments that is said to be hurting the country’s startup ecosystem
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