EPFO And ESIC e-Wallet: Subscribers May Soon Get Their Claim Amount In A Digital Wallet

The Employees’ Provident Fund Organisation (EPFO) and Employees’ State Insurance Corporation (ESIC) subscribers may soon receive their claim withdrawal amount in e-wallets instead of in bank accounts. “This is an area of great interest for the insured person, for a contributor. How can I withdraw my money more easily”, PTI reported Sumita Dawra, Secretary in the Ministry of Labour and Employment, as saying.

Currently, when a withdrawal claim is settled, money is transferred to subscribers’ bank accounts. However, if an e-wallet is launched, the money will then be transferred to those wallets. The respective regulatory bodies are in touch with the Reserve Bank of India (RBI) to work out how to do this.

Also Read: Unclaimed Mutual Funds: SEBI Considers Developing MITR Platform To Track Inactive Folios

Dawra said, “Now you are talking about how the claim can go directly to probably a wallet or, we'll have to work out some mechanism. So there we have started talks with bankers and also we are going to have a plan in place on how we can do this practically”.

As digital modes are becoming more popular for financial transactions, e-wallets will be easier to use and expected to be faster as well.

Also Read: EPFO May Introduce ‘Self-Approval’ System For PF Withdrawals Starting Next Year  

What Do EPF And ESI Schemes Offer?

EPF and ESIC are available for the organized sector workers to provide them with social security. Both are contributory schemes where both employee and employee make payment.

EPF: EPF deduction is mandatory for organisations employing 20 or more employees. As per the rules, the employee and employer, both contribute 12 per cent, of the employee’s salary (basic plus dearness allowance) in the EPF account. Employees’ entire contribution goes to the EPF account, while the employers’ contribution is divided: 3.67 per cent goes to the EPF, and the remaining 8.33 per cent to the employee pension scheme (EPS).

ESI: In organisations employing 10 or more individuals, offering ESIC is mandatory. This scheme provides social security benefits, specifically targeting workers in factories, road transport, newspapers, educational and medical institutions, hotels, restaurants, and shops.

Also Read: Unclaimed Policy Amounts With LIC Surge To Rs 880.93 Crore; Learn How To Check If You Have Unclaimed Insurance Funds 

The wage ceiling in this scheme is Rs 21,000, which means for a salary up to Rs 21,000, organisation are mandated to deduct and contribute to ESIC for the employee. In the case of disability, the wage ceiling is Rs 25,000.

It covers members for their and their families’ medical needs, injury, death due to injury, maternity benefits to the family, and rehabilitation benefits in some cases.

Under this scheme, employers’ contribution is 3.25 per cent and employees’ contribution is 0.75 per cent, so a total of four per cent of the salary is contributed to the scheme.