EPS pensioners can now withdraw their pension from any bank in India
New Delhi, Jan 1, 2025
Under the new rules effective January 1, 2025, 7.8 million members of EPS will benefit from Centralised Pension Payment System
The pensioners under the Employees' Pension Scheme (EPS), 1995, will have the flexibility to access their pensions from any bank branch in India from January 1, 2025. In September 2024, Minister of Labour and Employment, Mansukh Mandaviya, approved the Centralised Pension Payment System (CPPS). This system will allow 7.8 million members of EPS to withdraw their pensions from any bank branch across the country.
What is Centralised Pension Payment System
The CPPS marks a major transformation by offering a nationwide centralised platform that enables pension disbursements through any bank or branch across India. Even if a pensioner moves or changes banks or branches, the CPPS ensures uninterrupted pension payments throughout India, without the need to transfer Pension Payment Orders (PPO) from one office to another.
Key features of CPPS
National accessibility: Pensioners can access funds from any bank or branch nationwide.
Elimination of transfer requirements: No need to transfer PPO when relocating or changing banks.
Aadhaar integration: Plans include a transition to an Aadhaar-based payment system.
Cost reduction: EPFO expects significant savings in pension disbursement costs.
Here are some new EPFO rules:
Change in the employee's contribution limit
A key update concerns the removal of the EPF contribution cap for employees. Currently, employees contribute 12 per cent of their basic salary to their EPF account each month. However, a proposal aims to allow employees to contribute based on their actual salary rather than the EPFO-prescribed ceiling of ~15,000. If implemented, this policy will enable employees to build a larger retirement corpus, leading to a higher monthly pension payout.
ATM withdrawal facility
In a bid to enhance financial accessibility, the EPFO will issue ATM cards to its members. This will enable subscribers to withdraw their provident fund savings directly from ATMs, providing 24/7 access to their funds. This feature aims to facilitate quicker access to savings, particularly during emergencies, thereby improving financial security for account holders.
Higher pension deadline
EPFO, in its press release issued on December 18, 2024, has announced a final opportunity for employers to submit employees' wage details by January 31, 2025. Additionally, employers must respond to any clarifications sought by EPFO by January 15, 2025, to facilitate the processing of higher pension applications.
New rule for EPF death claim
A new rule has been introduced for processing EPF death claims. Moving forward, physical claims without Aadhaar seeding may be accepted temporarily, provided they receive proper approval from the Officer in Charge (OIC) through an e-office file. The file must include details of the verification conducted to confirm the deceased's membership and validate the claimants' authenticity. To prevent fraudulent withdrawals, additional due diligence measures, as deemed appropriate by the OIC, may also be implemented.
[The Business Standard]
