The total amount in the investment corpus of the Employee Provident Fund Organisation (EPFO) witnessed an uptick by 16.7% in the financial year 2022-23 (FY23) to Rs 21.3 lakh crore from Rs 18.3 lakh crore in FY22, as per the draft annual report of the retirement fund.
In the last five years, the total investible corpus under the social security organisation has almost doubled.
Previously, in FY19, the total corpus surged to Rs 11.1 lakh crore. Of the total Rs 21.3 lakh crore, the Employee Provident Fund (EPF) comprised Rs 13.04 lakh crore. This was closely followed by the Employee Pension Fund, which stood at Rs 7.7 lakh crore and the Employees’ Linked Deposit Insurance Scheme, which registered Rs 41,062 crore.
EPFO invested a considerable part of its corpus during the financial year in State Development Loans (SDLs), which was 38.6%. State governments use SDLs to fund their fiscal deficits.
This was followed by central government securities at 17.7%, corporate bonds of public sector enterprises at 15.5%, and public accounts with the central government at 10.1%.
The spike in investible corpus under the social security organisation is fueled by the rise in subscriber base over the past few years, which translates as more income for the body and better returns; this can then be utilised to credit a higher interest to its about seven crore subscribers.
Earlier in FY22, the total amount under the corpus had surged by 26.6% to Rs 18.3 lakh crore.
In addition, the share of total investments, which stood at Rs 1.96 lakh crore, in Exchange-Traded Funds (ETFs) also rose to 9.2% from 8.7 % (Rs 1.6 lakh crore) in FY21, thereby closing the gap with the 15% ceiling put in place.
EPFO had started investing 5% of its corpus in ETFs based on the Nifty 50 and S&P BSE Sensex in August 2015 in an effort to earn higher income on its investments and subsequently raised the limit to 15%.
Rajiv is an independent editorial consultant for the last decade. Prior to this, he worked as a full-time journalist associated with various prominent print media houses. In his spare time, he loves to paint on canvas.
