Post Central Board of Trustees (CBT) meet on 5th March.'20, Employees Provident
Fund Organisation (EPFO) has revised Rate of Interest (ROI) to 8.50% for FY19-20 from PY18-19 of 8.65%. This marks a 15 basis points cut from the previous year.
Movement of EFP Rate of interest
announcements & movement from FY12-13 to FY19-20.
Financial Year
|
EPF Interest Rates
|
FY 2019-20
|
8.50%
|
FY 2018-19
|
8.65%
|
FY 2017-18
|
8.55%
|
FY 2016-17
|
8.65%
|
FY 2015-16
|
8.80%
|
FY 2014-15
|
8.75%
|
FY 2013-14
|
8.75%
|
FY 2012-13
|
8.50%
|
Cut in ROI is due to lower earnings from exposure in debt investments
in some troubled companies. EPFO has over
4,500 crores debt exposure in DHFL & IL&FS. Even at current rate, EPF
ROI is better than some govt scheme (like post office savings, PPF etc) or bank
FD investments, as it comes tax free at all stages. EPFO has over 60 million
active subscribers.
Finance Ministry had earlier advised Labour Ministry to align EPF rates with other govt run scheme. As GOI stand guarantor, finance ministry vets
EPF rate proposal to avoid additional liability on account of shortfall in EPFO
income vs interest outgo for current Financial Year.
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