EPFO Update: Money from inactive PF accounts directly into account; Big announcement of Central Govt

EPFO Update: The central government has launched a major initiative to recover money deposited in inactive PF accounts. According to the Labor Ministry, this will directly benefit lakhs of account holders. In the first phase, the money deposited in approximately 7 lakh accounts will be transferred directly to the bank accounts of the beneficiaries. This decision was taken in a review meeting chaired by Labor Minister Mansukh Mandaviya. According to the ministry, EPFO ​​has 31.86 lakh dormant accounts, with a total of Rs 10,903 crore.

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Of these, 7.11 lakh accounts have small amounts of up to 1,000, totaling more than Rs 30 crore. Many accounts have been inactive for the past three years, making them inactive. Some accounts are more than 20 years old. Aadhaar and bank details have already been linked to 7 lakh accounts selected in the pilot phase, enabling direct fund transfer.

As per the applicable rules, the beneficiaries need to file a claim for withdrawal of PF funds. However, due to low amount and lengthy paperwork, many people do not claim. As a result, crores of rupees have piled up in dormant accounts over the years. Now, the ministry is preparing to simplify the process and return the funds directly to their accounts. The government believes that this will bring great relief to common workers and ensure that their money does not remain idle. This step is also considered important to strengthen social security.

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Another major decision was taken in the meeting. Children of unorganized sector workers will now get merit-based scholarships of up to Rs 25,000 in addition to welfare scholarships. The ministry clarified that the changes in the scheme rules ensure that deserving students can also get merit scholarships from other state or central institutions. 779 million has been disbursed to 1.6 lakh students so far this year, a significant increase over last year. This initiative is in line with the objectives of the Social Security Code (2020), which aims to provide comprehensive social security to unorganized workers and their families.