EPFO simplifies online PF withdrawal process—Check what's new
What's the story
The Employees's Provident Fund Organisation (EPFO) has introduced major changes to its online provident fund withdrawal process.
From now on, applicants won't have to upload a canceled cheque image or get their bank accounts verified by employers.
This move is likely to speed up the claim settlement process for nearly 80 million members and ease business operations for employers.
Policy change
EPFO's new policy eliminates outdated requirements
Earlier, EPFO members had to upload either a canceled cheque image or authenticated photocopy of their bank account passbook, linked with their Universal Account Number (UAN) or PF number, while applying for online fund withdrawals.
Employers were also required to validate the applicant's bank account details.
However, these requirements have now been completely removed from the online claim filing process by the EPFO.
Goal
EPFO's move aims to streamline claim settlement process
The EPFO's move to do away with these requirements is intended to improve the 'ease of living' of Employees's Provident Fund (EPF) members and facilitate 'ease of doing business' for employers.
The labor ministry said these measures will greatly speed up the claim settlement process and lessen complaints of claim rejections.
The policy change will benefit members and employers in their dealings with the organization.
Pilot success
Pilot program benefits 1.7 crore EPF members
The requirement changes were first tested on a pilot basis for select KYC-updated members, beginning May 28, 2024.
The successful trial has already benefited around 17 million EPF members.
After the success, the EPFO has now extended the relaxation of these requirements to all its members, further simplifying the online withdrawal process for provident funds.
Impact
EPFO's changes aim to reduce claim rejections
The labor ministry clarified that as bank accounts are verified when linked with the UAN, no additional documentation is required anymore.
This change seeks to avoid claim rejections due to low-quality/unreadable uploads and reduce complaints related to it.
During FY2024-25, 13 million members sought to get their bank accounts linked with their UANs, resulting in an average verification time of three days by banks and around 13 days for employer approval post-verification.
Pending approvals
Over 14 lakh approvals pending with employers
As of now, out of the 77.4 million monthly contributing members, 48.3 million have linked their bank accounts with their UANs, with 1.495 million approvals pending at the employer level.
The removal of employer approval requirement will immediately benefit these members whose approvals are pending with employers.
The new policy also makes it easier for those wishing to change their already linked bank account by entering a new bank account number and IFSC code authenticated through Aadhaar-based OTP.