The Employees’ Provident Fund Organisation (EPFO) is a key retirement fund body in India. Here are five major changes it implemented in 2024.
The Employees’ Provident Fund Organisation (EPFO) added 13.41 lakh net new members in October 2024, showing a 16.23 per cent year-over-year growth. As one of India’s largest retirement fund bodies, EPFO has faced challenges ranging from procedural inefficiencies to operational issues. As 2024 comes to a close, here are five key changes EPFO implemented this year.
EPFO launched a link office arrangement to expedite claim settlements through its multi-location system. This operational enhancement ensures reduced delay and smoother processing in claim settlement by distributing claims evenly across branches.
On May 8, 2024, EPFO issued a circular saying, “The effective functioning of the link arrangement between Delegating Regional Office (DRO) - Collaborating Regional Office (CRO) shall be the responsibility of the RPFCs in-charge of both these offices, who are expected to work in close coordination to ensure that the desired results in the claim settlement periodicity are achieved without any issues. The ACCs of the Zones in respect of both DRO and CRO shall closely monitor the performance of the offices and facilitate proper implementation of the above work arrangement.”
The retirement body extended the auto settlement of claims facility to education and marriage claims (under para 68K) and housing purposes (under para 68B). The facility was previously available only for medical claims but now one can get advance through this auto-settlement facility for all these purposes. The limit has also been increased from Rs 50,000 to Rs 1 lakh.
EPFO’s circular dated April 16, 2024, read, “The Competent Authority has approved the limit of auto claim settlements under para 68J from Rs 50,000/- to Rs. 1,00,000/- and the same had been also deployed in the application software on 10/Apr/2024.”
Due to auto settlement, the settlement period has reduced drastically from 10 days to 3-4 days.
The operational procedure to upload a cheque or passbook unnecessarily delayed claims settlement. EPFO removed this requirement for uploading a cheque leaf or attested passbook copies for eligible cases, facilitating faster claim settlements.
Through the circular dated May 28, 2024, EPFO said, “To facilitate the speedy settlement of claims filed online and to reduce the rejection of claims due to the reason of non-uploading of the image of cheque leaf/ attested bank passbook while filing claims online, it has been decided with the approval of the CPFC to relax the requirement of mandatory uploading of the image of cheque leaf/ attested bank passbook for certain eligible cases based on certain validations which include Online Verification of the Bank KYC by concerned Bank/NPCI, Verification of Bank KYC by the employer using DSC, Seeded Aadhaar Number verified by UIDAI among others.”
This step expedited the process as the banks can verify an EPF member’s KYC details and digitally sign the verification details.
On June 21, 2024, EPFO issued a circular with directions to enhance outreach and improve services under the PRAYAAS initiative. The initiative was launched in 2020 to provide the pension payment order (PPO) to the employee on the day of superannuation however the initiative was not working as expected.
Thus, this year, EPFO introduced a dashboard for its zonal offices (ZO) and regional offices (RO) for better-monitoring employees about to retire and guiding them to submit the documents and pension claim in advance so that PPO can be issued to the employee on the last working day.
Though it has been conducting webinars for employees close to 58 or 60 years of age to make them aware of this service, in the June notification, it issued guidelines for PPO issuance in EPFO’s monthly ‘Nidhi Aapke Nikat (NAN)’ program.
Considering the rising number of inoperative EPF accounts and to reduce them, EPFO issued a new standard operating procedure (SOP) for inoperative EPF accounts through a circular dated August 2, 2024. An EPF account becomes inoperative when there has not been any contribution for three years. Superseding all the previous SOPs in this regard EPFO introduced detailed guidelines to handle the inoperative accounts. These include reactivating them or settling claims in cases of retirement or death.
In 2022-23, there were 17,44,518 inoperative EPF accounts which increased to 21,55,387 accounts in 2023-24.
These changes are part of EPFO’s ongoing efforts to improve efficiency and accessibility. There are several other changes under consideration that may take place in the coming year. It may include EPF withdrawal from ATMs, issuance of a unique card for this purpose, higher wage ceiling, and conversion of provident fund into a pension.