EPFO: Moving in sync with the times

At a time when fintech players and banks are vying to offer faster services to their customers, reduce paperwork, and move processes online for greater convenience, government bodies like the Employees’ Provident Fund Organisation (EPFO) too have realised that they need to change with the times. The EPFO, which has traditionally been perceived as stodgy, has surprised long-time watchers with its customer-friendly initiatives in recent months.

No certificates required for advances

Earlier if you wanted a non-refundable advance from your EPF account, you had to produce a certificate to prove your need was genuine.If you needed money for medical treatment, you had to produce a doctor's certificate. If you needed it to finance a child's marriage, you had to submit the wedding card as proof. All such requirements have been done away. "You can withdraw money by just making a self-declaration.This is in line with the central government's policy of relying on people's self-declaration as far as possible,"says VP Joy, central provident fund commissioner,EPFO.

Housing initiative

EPFO has now allowed subscribers to withdraw up to 90 percent of their corpus for housing. To avail this facility, subscribers will have to form a society, which must have at least 10 members."Whatever a member's accumulated savings, 90 per cent of those will be given upfront. For the balance he can take a loan. And the loan can be serviced through future instalments coming into the EPFO," says Joy.

Explaining the rationale behind relaxing the rule for advances, Joy says earlier members would close their accounts social security."If you retrain your account with the EPFO for 10 years, you get a life-long pension. If people know they can get advances for crucial purposes, We hope it will curb the tendency to close  their accounts prematurely," he says.

Financial sector experts offer a word of caution. " One of that challenges with retirement savings in our country is that the corpus gets used up for other purposes. While the easier availability of this advance is welcome, people need to use it prudently for their financial security after retirement," says Vishal Dhawan, Cheif financial planners, Plan Ahead Wealth Advisors.

Seeding Aadhaar

EPFO is now seeding members' Aadhaar numbers into its system. If yopu seed your aAadhaar number and bank account details  into the EPFO system, you will be able to avail yourself of a number of online services. Seeding can be done in four ways: By giving these details to your employer; entering these on the EPFO websites; via the common services centres run by the ministry of communicationand information technology; and at the EPFO offices, of which there are 260 across the country. " Once people do the Aadhaar seeding, they will be able to submit all their applications online. Online services will begin from May.At present, all claim applications have to be filled at the EPFO offices," says Joy.

Composite claim settlement form

Eralier, you had different forms for different types of claims and withdrawls. Now the EPFO jhas introduced a single composite cliams form. While the earlier forms used to run into two or three pages, the new one is of just one page.

Moreover, new IT systems are being put in place so that when people retire, they will get their provident fund cheque on the very same day. While may EPFO offices are already offering this facility, others will begion to do so soon.

Business Standard New Delhi, 02nd May 2017