EPFO: Safeguarding India’s Workforce, One Savings at a Time

The Employees’ Provident Fund Organisation (EPFO) is a significant entity in India, responsible for managing and regulating provident funds for employees in the country. Established in 1952, the EPFO is an organization under the Ministry of Labour and Employment, Government of India, and is one of the largest social security organizations in the world.
The EPFO’s primary function is to administer the retirement plan for employees in India, which includes a provident fund, a basic pension scheme, and a disability/death insurance scheme. The provident fund is a long-term savings plan that allows employees to save a portion of their salary each month, which is then matched by their employer. The accumulated funds are paid back to the employee when they retire or leave their job, along with interest earned over the years.
The basic pension scheme, also known as the Employees’ Pension Scheme (EPS), provides a monthly pension to employees after they retire. The amount of pension depends on the employee’s salary and the number of years they have contributed to the EPFO. The disability/death insurance scheme, known as the Employees’ Deposit Linked Insurance Scheme (EDLI), provides financial assistance to the family of an employee who dies while in service or becomes disabled.
The EPFO also manages social security agreements with other countries, allowing Indian workers employed abroad to continue contributing to their provident fund account in India. This is particularly beneficial for employees who work in countries where social security benefits are not as comprehensive as in India.
As of 2021, the EPFO manages more than ₹15.6 lakh crore (US$209 billion) in assets, making it one of the largest social security organizations in the world. The EPFO’s top decision-making body is the Central Board of Trustees (CBT), which is responsible for formulating policies and making decisions related to the organization’s operations.
The EPFO has made significant strides in recent years to modernize its operations and improve services to its members. The organization has introduced online services, allowing members to access their provident fund account, check their balance, and make withdrawals online. The EPFO has also introduced a mobile app, allowing members to access their account information on the go.
In December 2022, the EPFO introduced an e-nomination facility, allowing its members to submit their nomination details online. This move is aimed at simplifying the nomination process and reducing the need for physical documents.
In November 2022, the EPFO announced that it would allow partial withdrawal of up to 50% of the accumulated provident fund balance for skill development purposes. This move is aimed at encouraging employees to upgrade their skills and improve their employability.
In January 2023, the EPFO launched a new portal for international workers, allowing them to manage their provident fund accounts online. The portal is aimed at facilitating easy and convenient access to EPFO services for Indian workers employed abroad.
In February 2023, the EPFO announced that all its members must link their Universal Account Number (UAN) with their Aadhaar number by March 31, 2023. This move is aimed at ensuring better verification and authentication of EPFO members’ identity.
EPFO reduces interest rate for FY 2021-22: In February 2023, the EPFO announced a reduction in the interest rate for the financial year 2021-22 to 8.1%, down from 8.5% in the previous year. The decision was taken due to the lower returns earned by the EPFO on its investments.
In conclusion, the Employees’ Provident Fund Organisation is a vital organization in India, responsible for managing and regulating provident funds for employees in the country. The EPFO’s retirement plan, which includes a provident fund, a basic pension scheme, and a disability/death insurance scheme, provides financial security to millions of employees in India. With its modernized operations and improved services, the EPFO is well-positioned to continue serving the needs of its members for years to come.