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This is with reference to the decision taken by the Employees Provident Fund Organisation (EPFO) selecting three private fund managers, along with India’s largest commercial bank SBI, to manage its corpus of Rs 2,40,000 crore.

It is high time that the interest rate of 8.5 per cent, which the employees are earning on their Provident Fund savings, was hiked in tune with the general rise in interest rates and taking into account the inflationary trends.

Managing of a portion of PF by private players is expected to put the Union Government and EPFO in a better position to hike the PF interest rate from the prevailing 8.5 per cent.

Further, the Government would do well to amend the Provident Fund laws so as to make the PF scheme mandatory for more employers.

This is important considering the fact that India is a country which does not have adequate social security measures.

N. Vijayagopalan Bangalore

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