The Employees’ Provident Fund Organisation (EPFO) has implemented a new set of processes aimed at improving operational efficiency, security, and benefit extension for millions of subscribers. Efforts such as improved online claim settlement processes and revised pension eligibility are the reforms intended to facilitate better EPF management in a transparent manner.
Improved EPF Withdrawal Claim Processing
EPF withdrawal claims can now be submitted and tracked through the Unified Portal. With the new automated verification engines in place, the previously 20 working days to process claims has now reduced to just 7. This ensures ease of processing without paperwork stagnation, which speeds up the receipt of retirement funds in retirement savings accounts.
KYC and UAN Linking
EPFO has implemented complete KYC verification processes of Aadhaar, PAN, and bank accounts for all active UANs, thereby reinforcing account security. Subscribers who do not update their KYC by the given timelines risk account lockouts. Employers are also liable to face late-filing penalties if they do not fulfil the 100% KYC rule.
Updated EPS Eligibility and Pensionable Salary Threshold
To enhance social security benefits, EPFO has increased the pensionable wage cap to ₹25,000. Employees receiving wages between ₹15,000 and ₹25,000 will now be eligible for the Employee Pension Scheme (EPS) benefits. This adjustment helps widen the coverage of the pension and mitigates the impact of mid-income workers’ retirement income.
Streamlined Conditions for Partial Withdrawals
EPFO has lifted restrictions for partial withdrawals due to urgent education, house purchase, and medical treatment. The minimum period of service is now three years instead of five, and up to 90% of the account balance can be withdrawn. These changes enhance long-term account holders’ access to their funds while improving their financial security.
Digital Submission of Life Certificates for Senior Citizens
Pensioners are now able to submit life certificates visually via the e-Sahaj portal, eliminating the need for annual in-person verification. The new process employs biometric and OTP systems for identity verification, providing uninterrupted pension payments. This system is beneficial to the elderly as it minimises time and other resources needed to access services.
Impact on Employers and Compliance
By the next remittance cycle, employers are required to change the payroll systems to account for the updated contribution rates and EPS salary caps. Employers that do not comply may incur penalties, including being unable to submit payroll taxes until the issues are resolved. It is also the responsibility of human resources to send out change communications based on the new EPFO policies to make the internal adjustment easier for staff.
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