Employees Provident Fund Organization
Employees’ Provident Fund Organization (EPFO) subscribers will be able to get their PF money directly into their bank accounts using the UPI payment gateway through a new mobile application to be launched in April this year. According to news quoting sources, the Labor Ministry is working on a project under which a certain portion of the EPF will be reserved, while a larger portion will be available for withdrawal through the bank account through Unified Payments Interface (UPI). The source further said that EPFO will introduce a new mobile app, through which members will be able to withdraw money using the UPI gateway as well as avail other services like passbook balance.
This is how money will be transferred through the new app
Currently, members use either the Universal Account Number (UAN) portal or the UMANG app to access their EPF accounts and avail services. These services will be available on both platforms, while the new dedicated app will improve access and delivery of services for EPFO customers. The source said that subscribers will be able to view the eligible EPF balance amount available for transfer to their bank accounts through the mobile app. They will be allowed to use their added UPI PIN to complete the transaction, ensuring secure transfer of funds to bank accounts. EPFO is currently testing this service. The Labor Ministry is likely to launch this app on a large scale in April this year.
At present this is the system
Currently, EPFO members have to apply for a withdrawal claim to withdraw money from their EPF account, which is quite costly. Under the Automatic Settlement System, the withdrawal claim is settled electronically without any manual intervention within three days of submission of the application form. The limit of this automatic settlement system has been increased from the existing Rs 1 lakh to Rs 5 lakh. This facilitates a large number of EPFO members to withdraw money from their EPF account within three days for purposes such as illness, education, marriage and housing.
It started in Covid
EPFO, with approximately 8 crore members, had launched the Online Automatic Settlement System of advance claims to provide quick assistance to people facing financial distress during the Covid-19 pandemic. However, all members have to file a claim to withdraw money from their EPF account. The new system is being developed to avoid this time-consuming process and reduce the burden on EPFO, as more than 5 crore claims, mostly for EPF withdrawals, are settled every year. The source said that EPFO cannot allow its members to withdraw money directly from EPF accounts as it does not have any banking license. However, the source said that the government wants to improve the services of EPFO at par with banks.