Five Developments On Provident Fund (PF) That Will Impact Your Money
From interest rate for 2016-17 to Aadhaar to a new loyalty scheme, the last few days have seen a lot of development related to your provident fund or PF money. EPFO or Employees Provident Fund Organisation, which manages your provident fund money, has extended the deadline for submitting Aadhaar number to April 30, 2017 for its over four crore members.
The Employees’ Provident Fund Organisation (EPFO) had set March 31, 2017 as the deadline for submitting Aadhaar number earlier. EPFO has also extended the deadline for submitting digital life certificates for its over 50 lakh pensioners till April 30 to link pension accounts with Aadhaar.
Here are the other developments:
- About 4 crore subscribers of EPFO will get 8.65 per cent interest on provident fund deposits for 2016-17, as decided by the organisation’s trustees in December. The Finance Ministry has allowed the Labour Ministry to go ahead with 8.65 per cent rate of interest, Press Trust of India reported. The Finance Ministry in its communication to the Labour Ministry has, however, put a rider that the interest rate should not result in a deficit for the retirement fund. According to EPFO estimates, the fund will see a surplus after providing 8.65 per cent interest rate for the last fiscal.
- EPFO has proposed a loyalty-cum-life benefit of up to Rs. 50,000 at the time of retirement for contributing to the scheme for 20 years or more. The benefit will also be provided in case of permanent disability even if the members have contributed for less than 20 years, the EPFO board has decided. The benefits will be available for EPFO subscribers after approval from the government.
- EPFO’s apex decision-making body the Central Board of Trustees (CBT) has recommended a minimum sum assured ofRs. 2.5 lakh in the event of death of a subscriber. At present, the dependants of the deceased get a sum assured of up to Rs. 6 lakh. There is no provision of minimum insurance and any benefit for surviving members or in cases of permanent disability under the scheme. The benefits will be available for EPFO subscribers after approval from the government.
- The board of retirement fund body EPFO deferred the proposal to raise investment in stock market to 15 per cent of its investible deposits from current 10 per cent. “It was proposed to increase investments in the Exchanges Traded Funds to 15 per cent. But trade unions representatives opposed it,” an EPFO trustee said after the meeting. The EPFO has invested Rs. 18,069 crore in exchange trade funds (ETFs) till February 18, 2017 and yielded a return of 18.13 per cent on these investments. Earlier, Labour Minister Bandaru Dattatreya had indicated that the EPFO will increase its investment in ETFs in the backdrop of good returns.
- Nearly four crore members of retirement fund body EPFO will soon be able to settle their claims like EPF withdrawal through mobile application UMANG “The Employees’ Provident Fund Organisation (EPFO) is developing online claims settlement process by receiving application online,” Labour Minister Bandaru Dattatreya said in a written reply to the Lok Sabha.