What Happened
- The Employees' Provident Fund Organisation (EPFO) is preparing to empanel new partner agencies and appoint a fresh custodian to replace Standard Chartered Bank, which has held the role since November 2011.
- EPFO recently approved HDFC AMC and Aditya Birla Sun Life AMC as new asset management partners (October 2025), alongside reappointing SBI Fund Management and UTI AMC.
- The tenure of four existing AMCs — ICICI Prudential, SBI Funds Management, Nippon Life India, and UTI — expires 2 July 2026.
- EPFO's portfolio stood at Rs 31 trillion as of December 2025, with 89.36% in debt and 10.57% in equity.
- The organization is also finalising a new external concurrent auditor (ECA) to replace Choksi & Choksi LLP.
Static Topic Bridges
EPFO — Structure and Investment Pattern
EPFO is a statutory body under the Ministry of Labour and Employment, governed by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952. It administers three schemes: Employees' Provident Fund (EPF), Employees' Pension Scheme (EPS), and Employees' Deposit Linked Insurance Scheme (EDLI). The Central Board of Trustees (CBT), a tripartite body with government, employer, and employee representatives, decides the investment pattern. Currently, EPFO allocates 45-65% of fresh accretions to government securities, 20-45% to debt instruments, and 5-15% to equities via index funds (ETFs).
- Governing Act: EPF & Miscellaneous Provisions Act, 1952
- Three schemes: EPF, EPS, EDLI
- CBT: apex decision-making body (tripartite)
- Corpus: Rs 31 trillion (December 2025)
- Portfolio: 89.36% debt, 10.57% equity (December 2025)
- Equity investment: through ETFs tracking Sensex and Nifty (started August 2015)
- Employee contribution: 12% of basic salary; Employer: 12% (8.33% to EPS, 3.67% to EPF)
- Coverage: establishments with 20+ employees (can be extended to smaller ones)
Connection to this news: The custodian change and new AMC appointments are critical because the custodian safeguards the entire Rs 31 trillion corpus, while AMCs manage the equity component (10.57% or approximately Rs 3.3 trillion) — any mismanagement directly affects 6+ crore subscribers' retirement savings.
Role of Custodian in Fund Management
A custodian in the securities market holds financial assets on behalf of the fund, settles trades, tracks corporate actions (dividends, bonus shares), and provides safekeeping of securities in dematerialised form. In India, custodians are registered with SEBI under the SEBI (Custodian of Securities) Regulations, 1996. For EPFO, the custodian is responsible for maintaining records of all securities owned, settling buy/sell transactions, and ensuring compliance with the investment pattern notified by the government.
- Regulatory framework: SEBI (Custodian of Securities) Regulations, 1996
- Key custodians in India: Standard Chartered, Deutsche Bank, HDFC Bank, Kotak Mahindra Bank
- Custodian functions: safekeeping, settlement, corporate action processing, compliance reporting
- EPFO's current custodian: Standard Chartered Bank (since November 2011)
- Previous selection of Citibank as replacement was revoked in 2023
Connection to this news: Standard Chartered's 15-year tenure as EPFO's custodian is unusually long, and the revocation of Citibank's selection in 2023 indicates the complexity of replacing the custodian for the world's largest provident fund corpus without disrupting operations.
Social Security Architecture in India
India's social security framework includes EPFO (formal sector), National Pension System (NPS, for government employees post-2004 and voluntary for others), Atal Pension Yojana (APY, for unorganised sector), PM Shram Yogi Maan-dhan (for unorganised workers), and Employees' State Insurance (ESI) for health coverage. The Code on Social Security 2020 for the first time extended social security provisions to gig workers and platform workers. EPFO remains the largest social security organisation in India by corpus and subscriber base.
- EPFO subscribers: over 6 crore active members
- NPS subscribers: approximately 7.5 crore (including government and private)
- APY beneficiaries: over 6 crore
- Code on Social Security, 2020: covers EPF, ESI, gratuity, maternity, gig workers
- EPFO interest rate (FY25): 8.25% on EPF deposits
- Total social security coverage: still under 20% of total workforce (informal sector largely uncovered)
Connection to this news: EPFO's investment management overhaul — new AMCs, new custodian, new auditor — reflects the growing complexity of managing a Rs 31 trillion corpus that serves as the primary retirement safety net for India's formal sector workers.
Key Facts & Data
- EPFO corpus: Rs 31 trillion (December 2025)
- Portfolio allocation: 89.36% debt, 10.57% equity
- Current custodian: Standard Chartered Bank (since November 2011)
- New AMCs approved (October 2025): HDFC AMC, Aditya Birla Sun Life AMC
- Reappointed AMCs: SBI Fund Management, UTI AMC
- Expiring AMC tenures: ICICI Prudential, SBI, Nippon Life, UTI (2 July 2026)
- EPFO active subscribers: over 6 crore
- EPF interest rate (FY25): 8.25%