Finance Ministry rejects Workers' Bank proposal by EPFO
The Ministry of Finance has rejected a proposal for setting up a Workers' Bank by Employees' Provident Fund Organisation( EPFO), according to a senior official of the Labour Ministry.
Hyderabad: The Ministry of Finance has rejected a proposal for setting up a Workers' Bank by Employees' Provident Fund Organisation( EPFO), according to a senior official of the Labour Ministry.
Earlier, the EPFO had sent proposals to the Finance Ministry seeking permission to start a bank to serve its members.
The EPFO, which has about 3.7 crore subscribers, wanted to set up a bank and the proposal was discussed in the Central Board of Trustees' (CBT) meeting on December 19, 2014.
CBT is the apex decision making body of EPFO.
"The bank proposal was rejected by the Ministry of Finance. They are of the opinion that we do not have necessary competence for running a bank. Some internal discussions are going on in the Ministry. We are trying to come up with answers to satisfy Finance Ministry's queries," the official told PTI on condition of anonymity.
The core idea of setting up the bank is not to make huge profits, but to serve our own members primarily, the official said.
Another senior official of the EPFO said currently it manages funds to the tune of Rs 7.5 lakh crore and another Rs 2.5 lakh crore will be with the organisations of companies who were exempted to deposit PF with EPFO.
Then Labour Secretary Gauri Kumar had earlier said EPFO might not have the core competence to run a Workers' Bank.
However, the suggestions for such bank can be referred for consideration of Department of Financial Services based on discussions in CBT.
Labour Minister Bandaru Dattatreya had earlier said a committee in CBT is examining the issue to come up with suggestions.