New Delhi: The Employees’ Provident Fund Organisation (EPFO) operationalised its next generation reforms Wednesday, by migrating records of all its 34 crore members to a centralised database, a move aimed at not only improving operational efficiency of the provident fund system but also bringing transparency in service delivery.
Called EPFO 2.0., the Centralised IT Enabled Services (CITES) was launched by Union labour minister Mansukh Mandaviya. Prior to the launch of CITES, EPFO had a decentralised architecture with separate databases at each field office.
“But CITES will now enable a single centralised architecture with one national database,” Mandaviya said after launching the digital portal.
Mandaviya said, EPFO 2.0 will simplify withdrawal rules and automatically transfer provident fund transfers upon change of jobs among other facilities.
The minister added that EPFO has already completed the process of migrating its entire database of member records to the new centralised database. “Earlier, the services were tied to a particular regional office. Now, a member’s service request can be processed from any authorised location across the country,” the minister said.
Here are 10 key improvements CITES will provide and how they will benefit members.
Members annual interest credit will get expedited: Members will now be able to view the interest credit in their passbook by 15 July. Earlier, after the EPF interest rate was declared, it typically took until October–November for the interest to be credited to members’ accounts.
The annual interest for FY 25-26 (at 8.25 percent) to 34 crore member accounts estimated at over Rs 1.44 lakh crore will be auto-processed and then verified by field authorities before crediting to the member account balances.
Access to member information: On logging in to member portal, members will have access to a unified digital interface to view their membership details, provident fund balances, claim status, pensionable service records, and benefits availed, thereby ensuring transparency and access to information about their PF account and submission of claims.
In the previous system, members’ information was not available on a unified portal and remained scattered across different systems.
Pre-validation of claims: With CITES, member claims will undergo automated pre-validation prior to processing at EPFO offices. Any deficiencies or discrepancies will be identified upfront and appropriate guidance will be provided to members, thereby significantly reducing claim rejections and improving first-time acceptance rates.
Members will also be able to know what is the eligible amount, which they can apply for withdrawal from their PF account under the different types of withdrawals permitted and can make informed choices.
In the previous system, members did not have clear visibility of the amount they were eligible to withdraw under different withdrawal categories. As a result, claims exceeding the permissible limit were often rejected.
Automated claim settlement: A substantial proportion of member claims for advances up to Rs 5 lakh which are fully KYC-linked and validated will be processed through an auto-settlement mechanism.
Earlier, the auto-settlement limit for advance claims was Rs 1 lakh. It has now been enhanced to Rs 5 lakh
Facility to seek clarification online during claim processing: Now EPFO offices will be able to raise queries online through the system, wherever additional information or clarification is required during claim processing. Members can respond online, enabling faster resolution, minimising physical visits to EPFO offices and also reducing claim rejections.
Earlier, members did not have a facility to submit and receive clarifications online.
Centralised and faster claim disbursement: The new system will ensure that claim payments will be processed through a centralised payment architecture and routed through faster electronic payment channels, ensuring secure, efficient, and timely credit of settlement amounts directly into members’ bank accounts on the day of settlement.
Simplified partial withdrawal rules: Members will now be able to withdraw up to 75 percent of their total PF balance. EPFO has also reduced 13 of the previous complex partial withdrawal rules and simplified them into three categories: Essential needs (such as illness, education, and marriage), housing needs, and special circumstances making the withdrawal process simpler and easier for members to understand.
Automatic provident fund transfer upon change of job: Upon rejoining or taking up new employment, members will not be required to submit separate applications for the transfer of their Aadhaar-linked UAN based member accounts having provident fund accumulations. Transfer cases will be automatically initiated and settled.
Earlier, when members changed jobs, transferring their PF account required approvals from the previous employer, the new employer, and the EPFO office. In addition, members had to submit a separate claim to transfer their service history.
EPS Scheme Pensioners: They will be able to approach any PF office to avail any services or submit a life certificate.
Centralised pension payment system: Through the centralised pension payment system, the pension claim processed in any regional office can be paid through any bank account anywhere in India.
Earlier, pensioners could receive their pension only through the branch office to which their Pension Payment Order was linked.
(Edited by Viny Mishra)
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