Highest ever interest for EPF

Increase of 55 basis points:

Sanjeevi JAYASURIYA

The Employees’ Provident Fund (EPF) has declared the highest ever interest rate of 13.75 percent to its member balance in 2009.

This is an increase of 55 basis points compared to 13.20 percent in the preceding year.

The higher interest rate was possible due to prudent fund management, better investment options and low administrative expenses, Central Bank Governor Ajith Nivard Cabraal said.

The members will receive a real rate of return of 10.01 percent with this interest rate for 2009.

“The fund was well managed and will be invested in other investment avenues to diversify portfolio in the future. The planned options are equity and bond market and other different investment instruments”, he said.

The two million working population abroad would also be encouraged to contribute to the fund to receive benefits and a scheme will be introduced to attract self- employed persons.

The total number of member-accounts increased to 12.7 million from 12.5 million in 2008.

The fund (total liability to the members) stood at Rs 752.2 billion as at end of 2009 recording a considerable increase of 16.6 percent from Rs. 645 billion as at end 2008.

The fund is a significant social security scheme for the workers and plans are under way to retain the member funds by providing additional 10 percent interest rate. This would encourage the members to have EPF as a savings mode and earn a reasonable income, Labour Relations and Manpower Minister Athauda Seneviratne said.