The condition of the investors of the stock market has worsened due to the quorum of Corona, it may also have an impact on the members of EPF. According to the Hindustan Times news, the Employees Provident Fund Organization (EPFO) may fail to pay 8.5% interest to its nearly 6 crore members in 2019-20. Explain that while giving a shock to about six crore shareholders, EPFO will reduce the interest on their provident fund (PF) from 8.65% to 8.5% only. The interest rates have been cut by 0.15 per cent for the FY 2019-20.
This is the reason for the crisis
In fact, EPFO could not redeem a major portion of its Rs 95,500 crore investment in exchange traded funds (ETFs). The equity market has been completely devastated since the March 11 corona epidemic was declared. Explain that at the Central Board of Trustees (CBT) meeting on 6 March, EPFO officials said that it would be sufficient to give 8.15% returns to customers by investing in government securities and bonds. The people present in this meeting said that the remaining 0.35% would be paid by cashing the ETF. Indeed, on March 6, the assurance of 0.35% was on a constitutional basis as the market was up when the agenda for CBT was circulated. ”
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On March 5, the BSE Sensex and the Nifty of the National Stock Exchange rose 0.16% to close at 38,471 points and 11,269 points respectively. The market fell 24% between 6 March and 19 March. The Sensex fell 2.01% to close at 28,288 points on Thursday and the Nifty fell 2.42% to 8,263 points. CBT member and Hind Mazdoor Sabha (HMS) general secretary Harbhajan Singh Sidhu said that it is not humanly possible for anyone to understand the finer points in just one day and to discuss these matters in a 3-4-hour meeting. .
Annual return given by EPFO
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The meeting attendees confirmed that the lack of sufficient time on the agenda was raised at the CBT meeting and Labor Minister Santosh Kumar Gangwar assured the members that the agenda would be delivered to them 15 days ahead of future meetings. Hemant Jain, EPFO’s financial advisor, did not respond to queries sent by HT. CBT member and Bharatiya Mazdoor Sangh (BMS) general secretary Virjesh Upadhyay said the government cannot reduce the interest rate fixed on 6 March.