EPFO subscribers to get loyalty-cum-life benefit of up to Rs 50,000

Don't want to miss the best from Business Standard?

Retirement fund body EPFO's subscribers will get loyalty-cum-life benefit of up to Rs 50,000 at the time of retirement for contributing to the scheme for 20 years or more.

The benefit will also be provided in case of permanent disability even if the members have contributed for less than 20 years, the EPFO board has decided.

The Employees' Provident Fund Organisation's (EPFO) apex decision making body, the Central Board of Trustees (CBT), has recommended a minimum sum assured of Rs 2.5 lakh in the event of death of a subscriber.

"The CBT has recommended amending the Employees' Deposit Linked Insurance Scheme (EDLI) to provide for minimum benefit of Rs 2.5 lakh and loyalty-cum-life benefit of up to Rs 50,000 at a meeting held yesterday," a senior official said.

"The suggested benefits will be available to members after government approval. Initially, these will be provided for two years on a pilot basis and will be reviewed thereafter."

According to the proposal, loyalty-cum-life benefit will be provided to all those members on retirement at 58 or 60 years who have contributed to the scheme for 20 years or more.

The benefit will also be provided in case of permanent disability. In these cases, the members who have contributed to the EDLI scheme for less than 20 years will be eligible.

Those members whose average basic wages are up to Rs 5,000 will get loyalty-cum-life benefit of Rs 30,000. Similarly, the members with wages of Rs 5,001-10,000 Will be eligible for Rs 40,000 benefit.

All those members getting more than Rs 10,000 monthly wage will be eligible for Rs 50,000 loyalty-cum-life benefit under the proposed scheme.

The board has recommended such benefits in view of a huge EDLI corpus of Rs 18,119 crore following addition of interest that accrued on investment of this fund.

At present, the dependants of the deceased get a sum assured of up to Rs 6 lakh. There is no provision of minimum insurance and any benefit for surviving members or in cases of permanent disability under the scheme.

Labour Minister Bandaru Dattatreya launched Aadhaar Seeding Application after the meeting. The EPFO has developed this application with support of Common Service Centres (CSCs) and C-DAC.

The CSCs are ICT-enabled front-end service delivery points at the village level for delivery of government and private services.

With implementation of the seeding application, a PF member or pensioner can now walk into any of the field offices of EPFO or CSC outlets with UAN and Aadhaar and seed them.

The EPFO enrolled 49,39,929 workers during January-March 2017. It had launched a special enrolment scheme to cover leftout formal sector workers from January 2017.