Employees Provident Fund Organisation (EPFO) has reduced the interest rate to 8.55% for 2017-18 as against 8.65% for 2016-17 and 8.8% in 2015-16.
The Employees’ Provident Fund Organisation (EPFO), India’s retirement fund manager, has cut the interest rate it pays to more than 50 million subscribers to 8.55% for the year to 31 March, the lowest in five years.
The labour ministry-controlled retirement fund manager had paid 8.65% the previous year. As per earning estimates, an 8.65% interest payout would have still left a surplus of Rs48.42 crore.
Currently, EPFO invests 15% of its annual accruals in equities via exchange-traded funds and the remaining 85% in debt instruments, including government bonds, private sector bonds and fixed deposits. Since August 2015, when it entered the stock market, the body has invested a little over Rs44,000 crore. As of January-end, its equity investments have earned around 16% returns.