EPFO Claim Settlement: Key Changes to Watch for in the New Financial Year 2025-26

EPFO Claim Settlement: Key Changes to Watch for in the New Financial Year 2025-26. In the past year or two, the Employees Provident Fund Organisation (EPFO) has implemented several measures to streamline the claims settlement process for PF account holders. These actions were recently outlined by the Union Minister of State for Labour and Employment, Shobha Karandlaje, in a written response to multiple questions in the Rajya Sabha.”

Important Changes for the New Financial Year 2025-26

The important Changes you should know as we enter the new financial year 2025-26, which will start from the 1st of April 2025, are here:

• The limit for processing advanced auto claims has been increased to Rs.1 lakh to enable faster settlement. Besides advances for illness or hospitalization, auto mode also includes advances for housing, education, and marriage. The minister said that 60% of advance claims are automatically processed, and these are finalized within three days. Till the 6th of March 2025, the EPFO has cleared 2.16 crore auto-claims during this financial year, as against only 89.52 lakh auto-claims in 2023-24.

• The minister revealed that the mechanism for rectifying member details has been streamlined. Members with Aadhaar-verified UANs can now rectify their IDs on their own without EPFO intervention. She further stated that at present, nearly 96% of the corrections are being done without the EPF office’s involvement.

• The need for the employer’s verification of Aadhaar-linked UANs in PF transfer claim applications has been eliminated. The minister stated that now, only 10% of transfer claims are subject to attestation from the member as well as the employer.

• Filing of a cheque leaf along with the claim form is no longer required. “The requirement for giving a cheque leaf along with the claim form has been relaxed for KYC-compliant UANs fulfilling the criteria as laid down,” said the minister.

• The minister explained that EPFO has introduced specific upfront validations to assist members in determining the eligibility and admissibility of their claims. This initiative aims to prevent the submission of ineligible claims by members.
  

The EPFO now processes over 99.31% of claims online, eliminating the need for members to visit field offices. As of March 6, 2025, a total of 7.14 crore claims have been submitted through the online platform in FY 2024-25. Additionally, the EPFO is enhancing claim settlements by centralizing member records under CITES 2.01. The minister also mentioned that consultations with stakeholders have been carried out as part of EPFO 3.0, aiming to transform EPFO into a “future-ready, member-centric, and technology-driven organization.”

EPFO’s New rules, which have provided relief to millions of private workers:

The Employees’ Provident Fund Organisation (EPFO) has addressed one of the biggest challenges faced by millions of private-sector workers. The government has alleviated the burden for the heads of numerous employees by raising the eligibility limit for applying for the Provident Fund, a mandatory benefit. Mentioned in the Paragraph below.

Increased Eligibility for Basic Salary:

The new regulation has increased the minimum basic salary requirement for Provident Fund eligibility to ₹21,000, up from the previous ₹15,000. As a result, employees earning a basic salary of up to ₹21,000 are now eligible for PF benefits. This updated threshold will include a greater number of private-sector workers, providing them with long-term savings and social security benefits.

It matters because millions of private-sector workers, primarily from lower and middle-income groups, were excluded from PF benefits due to the previous high salary cap. This revision not only expands the safety net but also marks the first step in the government’s effort to provide financial security to workers.

Key Benefits of the Revised Salary Ceiling:

• Enhanced Retirement Benefits
• Financial Security
• Increased Employer Contributions

Positive Response from Workers:
The announcement has been warmly received, creating a positive atmosphere among private-sector workers. Employees now feel included in India’s social security system, and the change underscores the government’s commitment to improving labor welfare and raising the living standards of private employees.

EPFO Plans EPF Claim Payouts via UPI

The EPFO is working on integrating UPI for quicker EPF claim payouts, allowing subscribers to access claim amounts through digital wallets. This move is expected to reduce processing time and enhance the user experience.

Key Points:

• UPI integration to speed up EPF claim processing.
• EPFO is in discussions with NPCI for the rollout.
• Around 7.4 million subscribers will benefit from this change.

UPI Integration
The EPFO plans to introduce UPI-based EPF claim withdrawals, simplifying and speeding up the transfer of funds to subscribers.

Timeline:
The EPFO plans to implement this feature within the next 2 to 3 months.

Purpose:
This initiative is part of the EPFO’s ongoing efforts to enhance efficiency and provide better services to its millions of subscribers, making access to EPF funds faster and more convenient.

Collaboration:
The EPFO is partnering with the National Payments Corporation of India (NPCI) to integrate UPI for fund transfers. Additionally, the Ministry of Labour is working with commercial banks and the RBI to digitize systems.

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Advantages:

• Faster and more convenient fund transfers.
• Increased accessibility, especially for remote-area subscribers.
• Reduced processing time and paperwork.
• Higher volume of auto claim settlements.