Source – businesstoday.in
Increased Auto Settlement Limit for EPFO Members
The Employees’ Provident Fund Organisation (EPFO) has decided to increase the auto settlement of advance claims (ASAC) limit from ₹1 lakh to ₹5 lakh, benefiting its 7.5 crore members. This initiative aims to improve the ‘Ease of Living’ by offering a faster and more efficient claim process.
The decision was approved by Sumita Dawra, Secretary, Ministry of Labour and Employment, during the 113th Executive Committee (EC) meeting of the Central Board of Trustees (CBT) in Srinagar, Jammu & Kashmir, on March 28, 2025. Once formally ratified by the CBT, EPFO members will be allowed to withdraw up to ₹5 lakh through ASAC without requiring additional approvals.
The auto mode of claim settlement, originally introduced in April 2020 for illness-related claims, was previously enhanced from ₹50,000 to ₹1 lakh in May 2024. The scope of auto-mode settlements has now been extended to include claims for education, marriage, and housing, further simplifying access to provident fund benefits.
Faster Claim Processing Through Automation
EPFO has implemented an automated claim settlement process, ensuring that 95% of claims are processed within three days. The latest data, as of March 6, 2025, reveals a record-high 2.16 crore auto-claims settled, a sharp increase from 89.52 lakh settlements in the 2023-24 financial year.
Additionally, the claim rejection rate has significantly dropped from 50% to 30%, demonstrating improved efficiency in processing applications. To streamline the claim process further, EPFO has reduced validation formalities from 27 steps to 18, with further reductions planned.
The introduction of a centralized, IT-enabled member database ensures that claims with verified KYC details, eligibility checks, and bank validation are automatically processed within 3-4 days. If any discrepancies arise, such claims are escalated for secondary scrutiny and manual approval to maintain accuracy.
UPI Withdrawals to Revolutionize PF Transactions
In a groundbreaking move, EPFO has announced plans to introduce Provident Fund (PF) withdrawals through the Unified Payments Interface (UPI). The Ministry of Labour and Employment has approved the National Payments Corporation of India’s (NPCI) recommendation, enabling EPFO members to withdraw PF funds using UPI and ATMs.
The new withdrawal system is expected to be launched by May or June 2025, significantly enhancing accessibility and convenience for members. This initiative may also be extended to other financial schemes, including the General Provident Fund (GPF) and Public Provident Fund (PPF), benefiting a broader segment of salaried employees.
With these digital advancements, EPFO continues to modernize its operations, ensuring faster claim settlements, greater financial accessibility, and improved member satisfaction. The increase in claim limits and digital payment integration marks a significant step toward making Employees’ Provident Fund Organisation (EPFO) services more user-friendly and efficient.
