Key Points
Two major reforms simplify EPFO claim settlement process
Bank account seeding now faster without employer approval
7.7 crore members will benefit from new guidelines
The EPFO has dispensed with the requirement of uploading an image of a cheque leaf or attested bank passbook while filing online claims, which would benefit over 7.7 crore members.
According to the government, this requirement was initially relaxed on a pilot basis for certain KYC-updated members. Since its launch on May 28, 2024, the move has already benefited 1.7 crore EPFO members.
Following the successful pilot, the EPFO has now extended this relaxation to all members, said the Ministry of Labour and Employment.
As the bank account holder’s name is already verified with the EPFO member’s details at the time of bank account seeding with the Universal Account Number (UAN), this additional documentation is no longer necessary.
"Under the leadership of PM Narendra Modi, the EPFO continues its reform journey. Two major reforms have been introduced to make the claim settlement process simpler, faster, and hassle-free for crores of EPF members and employers," Union Minister of Labour and Employment Dr Mansukh Mandaviya said.
To streamline the process of seeding bank accounts with UAN, the EPFO has also removed the requirement of employer approval after bank verification.
Currently, every member is required to seed his/her Bank Account with UAN in order to get their PF withdrawals seamlessly credited to such account.
During FY 2024-25, 1.3 crore members submitted their requests for seeding their bank accounts and the requests after due matching with the respective Bank/NPCI are to be approved by the Employer through DSC/E-Sign.
"It is seen that around 36,000 requests for seeding of bank accounts are being raised by the members on a daily basis, and the banks take an average of 3 days to complete the verification," said the ministry.
However, after the bank verification, the average time taken by the employer to approve the process is about 13 days, resulting in piling up of workload at the level of the employer and consequent delay in the seeding of bank account for the Member.
Further, this approval step is not adding any value to the verification process.
Out of 7.74 crore members who are presently contributing each month, already 4.83 crore members have seeded their Bank Accounts in UAN with 14.95 lakh approvals are pending at the level of the employers.
"The above simplified process will also facilitate those members who want to change their already seeded Bank Account by entering their new bank account no along with the IFSC code duly authenticated through Aadhaar OTP," the ministry informed.
