February 10, 2024: The government on February 10, 2024, notified 8.25% rate of interest for provident fund (PF) contributions for 2023-24 (FY24). As a result of this, the Employees’ Provident Fund Organisation (EPFO) will credit 8.25% interest on EPF contributions made for last financial year.
That begs the question: how does the EPFO generate this income to pay its subscribers an interest?
“The EPFO does not invest directly in individual stocks, including stocks of any blue-chip company. The EPFO invests in equity markets through ETFs, replicating BSE-Sensex and Nifty-50 indices. The EPFO has also invested from time-to-time in ETFs constructed specifically for disinvestment of shareholding of the government of India in body corporates,” the minister said in his reply.
EPFO investments in ETFs
| Year | Amount in Rs crore |
| 2018-19 | 27,974 |
| 2019-20 | 31,501 |
| 2020-21 | 32,071 |
| 2021-22 | 43,568 |
| 2022-23 | 53,081* |
| 2023-24 | (till July, 2023) 13,017* |
*Provisional
(Source: Labour and employment ministry)
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