What to do for online pf transfer, know how to apply

EPFO interest rate once again in discussion, where does EPFO ​​earn money by investing the fund

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new Delhi . EPFO ie Employee Provident Fund Organization has reduced the interest rate on PF on Saturday. Now the interest rates on PF have come down to a 40-year low. Reducing interest rates are once again in the news. It has recommended an interest rate of 8.1% for the financial year 2021-2022. This is the lowest interest rate on PF in the last 40 years. Last week, the Finance Ministry approved the proposal of 8.5 percent interest rate for the financial year 2020-21.

Now interest money will come in the account of people working in the private sector. Do you know how EPFO ​​earns this interest, where does it invest its funds, how interest is credited to your account? Ain know the answers to these questions.

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In the next two to three weeks, this money will come in the subscriber’s account.
The Central Board of Trustees (CBT) of EPFO ​​recommends the interest rate on PF. Then, the Labor Ministry takes the approval of the Finance Ministry on this. Last week, the Finance Ministry approved 8.5 percent interest rate for 2020-21. Now EPFO ​​will issue its notification. After this, this money will be transferred to the subscriber’s account in the next two to three weeks.

What is CBT?
CBT is the most powerful decision making body of EPFO. It is headed by the Union Labor Minister. The Labor Secretary of the Central Government is its Vice-Chairman. It consists of 5 representatives of the Central Government and 15 representatives of the State Governments. It also includes 10 representatives of employees and 10-10 representatives of employers.

Also read- Big blow to the employed people, EPFO ​​reduced interest rate, interest rate came down to 40 years low

Where is the fund invested?
The EPFO ​​invests 85 per cent of its money in debt (like bonds) and the remaining 15 per cent in stocks. Under debt, it is allowed to invest at least 45 per cent and maximum 65 per cent in government securities and related instruments.

He can invest a minimum of 20 percent and a maximum of 45 percent in debt securities of companies. He can also invest in the security of banks and government financial institutions. The condition is that the remaining maturity period of such instrument should be at least 3 years. Fund managers can put up to 5 per cent of their funds in short-term debt. Under this, instruments like commercial paper come.

As far as investment in stocks is concerned, EPF is also allowed to invest in mutual funds and SEBI regulated exchange traded funds.

Tags: Epfo, EPFO Insiders, EPFO subscribers, EPFO website

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