EPF subscribers to receive interest till the date of settlement: CBT Board decides | Mint
Source: Live Mint
A number of key decisions were taken in the 236th meeting of Central Board of Trustees (CBT), EPFO on Saturday.
These changes relate to paying a higher interest to subscribers, Investment in InvITs and REIT, and redemption Policy for ETF investments. The meeting was headed by Mansukh Mandaviya, Union Minister for Labour & Employment and Youth Affairs and Sports.
The board was informed that in the current financial year, 3.83 crore claims have already been settled for more than Rs.1.57 lakh crore. Last year, EPFO settled 4.45 crore claims for an amount of Rs.1.82 lakh crore.
Additionally, it was informed to the Board about major initiatives taken by EPFO since the last meeting of CBT. The limit for auto claims settlement facility was extended to ₹1 lakh from ₹50,000 which has also been extended to advances for housing, marriage and education.
These are the key decisions that were taken:
I. Higher interest: Now, the interest will be paid to the member up to the date of settlement. This will result in financial benefit to the members and reduce the grievances.
As per existing provisions, for the claim settled till 24th of the month, interest is paid only upto the end of the preceding month.
II. After 25th of the month: Till now, interest-bearing claims are not processed between the 25th and the end of each month to avoid loss of interest to the members. Now, these claims will be processed for the entire month leading to reduced pendency and timely settlement.
III. Investment in InvITs and REITs: The board also issued guidelines for investment in Units issued by Public Sector Undertaking-sponsored Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs)
IV. Redemption policy: The Board also approved a Redemption Policy for ETF investments in CPSE and Bharat 22 to generate income for the EPF Scheme’s ‘Interest Account.’
The policy mandates a minimum five-year holding, returns exceeding government securities, and performance above the CPSE and Bharat 22 indices.
