The last few weeks have seen various developments relating to Provident Fund accounts. Apart from the Employee Provident Fund making Aadhaar linkage mandatory, there are a few other notable changes that were announced. Here’s the scoop.
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Extension of deadline for linking Aadhaar to your Provident Fund account
The Employee Provident Fund Organisation has granted an extension of the last date to link your Aadhaar number with your Provident Fund account. The new date by which you need to update your Aadhaar number in the Provident Fund records is 30th April 2017.
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Digital Life certificates
Pensioners holding Provident Fund accounts also need to submit digital life certificates by 30th April 2017 in order to link their pension accounts with Aadhaar.
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More developments
Revised interest rate
The 4 crore Employee Provident Fund subscribers will get 8.65% interest on Provident Fund deposits for 2016-17. The Finance Ministry has permitted the imposition of the 8.65% interest rate provided that it should not result in deficits for the fund. The Employee Provident Fund Organisation expects to see a surplus after the announcement of the new interest rate.
Loyalty pays
The Employee Provident Fund Organisation has announced a loyalty-cum-life benefit of a sum up to Rs. 50,000 at retirement for contributing to the scheme for 20 years or more. This loyalty benefit will also be provided in the event of permanent disability even if members have contributed for a term less than 20 years. These benefits can be availed by Provident Fund subscribers after the necessary approvals from the government.
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Minimum Sum Assured
The Employee Provident Fund Organisation’s Central Board of Trustees (CBT) has suggested that a minimum Sum Assured of Rs. 2.5 lakh should be paid out in the event of death of a subscriber.
At present, the dependants of a deceased subscriber gets a Sum Assured of up to Rs. 6 lakh. However, there is no provision of minimum insurance, or any benefits to surviving members, or in cases of permanent disability under the scheme. These benefits can be availed for Provident Fund subscribers after the necessary approvals from the government.
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No increase in stock investments
The retirement fund body EPFO put on hold the proposal to increase investments in the stock market from 10% to 15% of its investible deposits. The EPFO proposed to increase investments in Exchange Traded Funds to 15%. The investments in Exchange Trade Funds (ETFs) until February 18, 2017 have yielded a return of 18.13%.
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Online claim settlement
Provident Fund subscribers will soon be able to settle any claims such as Employee Provident Fund withdrawals through the mobile application UMANG.
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