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Provident Fund: EPFO Proposes Entry Of Former Members, With A Low Contribution

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The Employees' Provident Fund Organisation (EPFO) is proposing to open up a subscription to its former members. The organization will offer this with a contribution of as low as Rs. 500 per month, to those who earlier left the scheme. The former member could have lost their jobs or migrated from the formal to the informal sector. According to EPFO estimations, about 4.8 million members left the scheme from 2018 to 2020, while the data has possibly increased since 2020, to date, due to the Covid-19 pandemic.

 
Provident Fund: EPFO Proposes Entry Of Former Members, With A Low Contribution

According to available reports in media, the former members can re-enter the EPFO scheme with an Rs. 500 minimum monthly contribution or 12% of monthly income. Economic Times has quoted an official, "We are trying to assess the impact of this on pension (EPS), provident fund (EPF) and the employees deposit-linked insurance scheme of EPFO. An actuary analysis is being done following which the scheme will be finalized." If EPFO's proposal gets accepted, millions of workers will benefit from this.

The Social Security Code 2020 of the government, gives scopes for the addition of new schemes under the EPFO, and the proposal can be implemented under this code by the next FY. EPFO offers high returns on the provident funds, in the latest FY it has given 8.5% interest to the subscribers. There are more than 69 million members and 7.1 million pensioners under the EPFO.

Read more about: epfo provident fund pension
Story first published: Saturday, November 27, 2021, 12:54 [IST]
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