700,000 inoperative PF accounts with Rs 1,000 balance each to get payout

EPFO launches automated refund drive to return Rs 30.52 cr from 711,000 inoperative accounts to members and heirs

More than 700,000 inoperative provident fund accounts that have up to Rs 1,000 each will have the amounts credited to members or legal heirs as part of clean-up drive by the Employees’ Provident Fund Organisation (EPFO), according to Press Trust of India (PTI).

 

Rs 30.52 crore to be refunded

 

An EPF account becomes “inoperative” if it has not received any contribution from either the employee or the employer for more than 36 months. Such accounts often belong to individuals who have changed jobs, retired, or lost track of their old savings. Citing a labour ministry source, PTI reported that Rs 30.52 crore is lying in 711,000 inoperative EPF accounts.

 

Overall, 3.186 million inoperative EPF accounts together hold Rs 10,903 crore, the source said. The current exercise targets smaller balances first.

 

How will the money be paid?

 

The refund process will be largely automated:

 

Amounts will be directly credited to the bank accounts of members whose EPF accounts are linked with Aadhaar.

 

In cases where the account holder has died, the money will be paid to the registered nominee or legal heir.

 

This move is part of a broader effort by the Ministry of Labour and Employment to clean up pending and inactive accounts and return funds to rightful beneficiaries.

 

For members, this underlines the importance of ensuring that their EPF accounts are Aadhaar-seeded and that nominee details are correctly updated. Without proper KYC linkage, claim settlement may face delays.

 

Bigger clean-up underway

 

The ministry is working towards settling all inoperative accounts in phases. The objective is to reduce idle balances and improve service efficiency.

 

At the same time, EPFO is rolling out ‘EPFO 3.0’, a digital transformation initiative aimed at overhauling member services. The project proposes to introduce core banking system-enabled facilities to streamline operations, reduce paperwork and provide a unified platform for managing accounts and claims.

 

Claims that clear risk management checks are designed to be processed automatically, without manual intervention. This could cut claim settlement time from as long as 20 days to less than three days, according to the source quoted by PTI.

 

The EPFO also conducts regular reviews to monitor grievance redressal and processing timelines.

 

(with inputs from PTI)