Employees Provident Fund act of 1962 has empowered EPF to mobilize its funds. The scope specified by the act where EPF can mobilize its fund is as follows:
Investment and/or trading government securities.
-
Investment in time deposits and cash certificates of banks within the country.
-
Investment in time deposits and cash certificates of appropriate finance companies within the country against bank guarantee.
-
Granting loans to corporate bodies and industrial enterprises against the government guarantee or against collateral securities with the approval of government or against the guarantee of financial institutions.
-
Investment in the share of banks & finance companies not exceeding 25 percent of the company's issued capital.
-
Investment in appropriate sectors under consortium finances.
-
Investment in the debenture of companies established under prevailing Act not exceeding 25 percent of the total debenture issued by the company
-
Undertaking housing projects independently or jointly with other institutions and sale or lease of housing units to members.
-
Establishment & operation of company either to sale & distribution of houses or housing plots or for the operation of housing projects.
-
Undertaking such other activities as would promote welfare of the members with the approval of government.
With the intentions of mobilizing its funds effectively EPF has formulated its own investment policy. Investment sectors, portfolio and priorities are fixed in the policy document. Following is the targeted investment portfolio of EPF:
S.N. |
Investment Sector |
% |
1 |
Credit to Contributors |
60.00 |
2 |
Government Securities |
30.00 |
3 |
Fixed Deposits (Commercial Banks) |
50.00 |
4 |
Land Development& Housing |
25.00 |
5 |
Project Financing |
25.00 |
6 |
Share & Debentures |
25.00 |
The following table lists the sector wise investment of different fiscal year since 1962:
SECTOR-WISE INVESTMENT
|
Fiscal
Year |
Investment
(Rupees in million) |
Time
Deposits % |
Govt.
Bonds % |
Corporate
Loan % |
Employees
Loan % |
Equity
(Share) % |
|
1962/63
|
8.51
|
70.98
|
27.73
|
00.00
|
01.29
|
-
|
|
1967/68
|
33.34
|
35.63
|
27.73
|
37.28
|
08.07
|
-
|
|
1972/73
|
134.59
|
58.36
|
19.02
|
13.16
|
19.73
|
-
|
|
1977/78
|
437.07
|
70.62
|
9.76
|
3.44
|
22.55
|
-
|
|
1982/83
|
1294.12
|
72.52
|
3.39
|
2.53
|
24.48
|
-
|
|
1987/88
|
3532.73
|
46.83
|
0.47
|
1.12
|
33.74
|
-
|
|
1992/93
|
6712.48
|
70.95
|
18.31
|
1.34
|
03.14
|
0.39 |
|
1997/98
|
15414.74
|
59.40
|
24.17
|
8.14
|
09.45
|
0.38 |
|
1998/99
|
18187.40
|
62.60
|
22.63
|
10.12
|
08.90
|
0.38
|
|
1999/00
|
20948.79
|
65.00
|
18.00
|
10.35
|
11.42
|
0.32
|
|
2000/01
|
24697.84
|
60.29
|
11.94
|
11.67
|
11.56
|
0.57
|
|
2001/02
|
28387.34
|
52.55
|
12.11
|
9.39
|
21.80
|
0.83
|
|
2002/03
|
33498.88
|
45.56
|
11.68
|
10.81
|
31.26
|
0.69
|
|
2003/04
|
39204.06
|
41.05
|
13.26
|
8.57 |
36.46
|
0.65 |
|
2004/05
|
44401.93
|
35.19
|
11.46
|
11.87
|
40.79
|
0.70
|
|
2005/06
|
49944.86 |
37.08
|
8.47
|
9.97
|
43.07
|
0.78
|