EPFO: A major update on EPFO is coming before the year wraps up. It’s crucial for all employees to be aware of this info, because if you don’t act, your PF funds could get completely frozen. Union Labour Minister Mansukh Mandavya mentioned that there are currently millions of inactive PF accounts. The Centre is now taking action to recover that blocked cash.
The Centre has revealed that funds have been stuck in numerous PF accounts for quite some time. Many of these accounts have gone inactive. Now, the Centre has kicked off efforts to recover those accounts. As part of a new initiative, KYC verification for EPF accounts will be implemented. A dedicated digital platform is being launched for this purpose.
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What will this platform include? It will display the EPF accounts that are inactive. Additionally, the nominees of the EPF accounts will be identified, ensuring that the money in the PF account can be returned to them. However, if KYC isn’t completed, that money won’t be accessible.
Union Minister Mansukh Mandavya also stated that similar to the agreement between India and Britain, there are ongoing efforts to introduce social security clauses in other countries as well. This means that individuals working abroad will be able to access their PF money upon returning to India.
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The Minister also discussed the current PF withdrawal process. He stated that EPF funds belong entirely to the employee, but currently, withdrawals require the filling of numerous forms. This often causes inconvenience and delays in claims. In light of these difficulties, the government is continuously working to simplify the EPF system so that employees can withdraw their funds on time without hassle.
Several major reforms related to PF have been approved
Recently, the EPFO approved several major reforms related to PF. Previously, there were 13 different categories for PF withdrawals, each with different conditions and service periods. This created confusion and resulted in many claims being rejected. Now, by merging all these categories, the rules have been simplified. Furthermore, the significant benefit is that PF withdrawals will now include not just the employee’s contribution but also the employer’s contribution and the interest earned on it. This means that withdrawing 75% of PF will result in a larger amount than before.