Employees’ Provident Fund Organization or EPFO members who have a Provident Fund (PF) account get tax-free and risk-free guaranteed returns on their money. However, it would be interesting for them to know that the Provident Fund Regulatory Authority manages the fund for PF interest to be paid to EPFO subscribers through EPFO investments. Investing also includes stocks and stock-related products. The Ministry of Labor and Employment, while answering a question in the Lok Sabha on Monday, 8 August 2022, told that how much of your money of EPFO invests in shares.
Responding to a question raised by Lok Sabha MPs including Ravi Kishan and Manoj Tiwari, Minister of State, Ministry of Labor and Employment, Rameshwar Teli said,Employees Provident Fund Organization (EPFO) invests 85 per cent of the fund in debt instruments and 15 per cent in exchange traded funds (ETFs), as per the investment pattern notified by the government.
MoS further said that investment in ETFs is done on the basis of Nifty 50, Sensex, Central Public Sector Enterprises (CPSEs) and Bharat 22 Index. The equity investment details for the last three years and the current year are as follows:
Financial Year Amount Invested in ETFs Total Amount Invested (Debt and Equity)
2019-20: 31,501.09 crore and 2,20,236.47 crore
2020-21: 32,070.84 crore and 2,18,533.89 crore
2021-22: 43,568.02 crore and 2,89,930.79 crore
2022-23 (up to June 2022): 12,199.26 crore and 84,477.67 crores.
Details of Cost Value and Notional Market Value of Investments in ETFs as on 31.03.2022 [as per Net Asset Value (NAV)] as on 31.03.2022:
Notional Market Value of the amount invested in the ETF as on 31.03.2022 (as on NAV as on 31.03.2022) 1,59,299.46 crore and 2,26,919.18 crores.
Ten-member Lok Sabha MPs, including Gorakhpur Lok Sabha MP Ravi Kishan and North East Delhi Lok Sabha MP Manoj Tiwari, had asked an unstarred question to the ministry, “….. Decision of the Government of India, if so, the total amount invested by EPFO in the stock market and related products during the last three years and the current year…”
Responding to the question, MoS Rameshwar Teli said, “CBTs for such purpose are invested through portfolio managers and ETF makers appointed by EPFO,” Financial Advisor to EPFO and External Concurrent Accounts. Examiners monitor all investments made. By the Portfolio Managers and ETF makers to confirm that they are in accordance with the investment pattern notified by the Government and the investment guidelines approved by CBT, EPFO from time to time.
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