The employee base in the country which contributes mandatorily 12% of their basic salary towards PF account will now fetch 2 set of returns, the new and handsome source now from 15% of the funds being invested in equity funds.
This has come as a new ruling which allows subscribers to be allotted amount invested in equity as ETF units which can be both tracked in terms of performance and other features. At the same time, subscribers can redeem the units at the market price.
Santosh Kumar Gangwar, Labour Minister said, the EPFO is allowed to invest upto 15% of the PF corpus into equity via ETFs.
The investment in equity via ETFs began in the year 2015 with the view to enhance returns for the PF subscribers.
Even the dividend returns for the subscriber would increase as the EPFO plans to distribute it to subscribers that shall take the returns for an individual enrolled in the scheme higher in the regime where interest rates are trending down.