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EPFO: The Employees' Provident Fund Organization is about to make a major change to its investment process. Currently, the EPFO invests funds from five different schemes into ETFs (exchange-traded funds) every month. This is now set to change. The EPFO will combine funds from these five schemes into a single account. Instead of monthly investments, the EPFO will now invest in ETFs only once a year. This will significantly simplify investment processes and paperwork.

What is the EPFO planning?
The EPFO currently invests in ETFs from its five schemes through separate accounts every month. Now, the EPFO will combine funds from these five schemes into a single account and invest in ETFs only once a year. This change will simplify both the investment process and paperwork. Furthermore, the EPFO will participate in the fourth buyback of non-convertible debentures (NCDs) of the Delhi-Meerut Expressway Development Company (DMEDL). The company is offering to buy each bond for ₹103,468, compared to its original price of ₹100,000. All these proposals have been approved by the EPFO's Investment Committee and will now be presented to the EPFO's Central Board of Trustees (CBT) meeting on March 2.

These proposals have already been approved by the EPFO's Investment Committee. They will now be presented for final approval at the EPFO's Central Board of Trustees meeting on March 2, but the agenda for this meeting does not include any announcement regarding the interest rate the EPFO will pay for 2025-26. According to an ET report, the meeting's agenda also states that the EPFO will prepare a new SOP (Standard Operating Procedure) to address current issues related to ETF investments.

Currently, the EPFO operates under the old SOP (Standard Operating Procedure) established in 2016. Under this SOP, the EPFO invests funds from each scheme separately and does not combine them. However, the EPFO now wants to change this approach. Doing so will reduce the risks posed by market fluctuations. Currently, the cycle for ETF investments runs from the 20th of each month to the 19th of the following month, but with the implementation of annual SIP, this monthly system will no longer be necessary.

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