Despite pandemic Covid-19 restrictions, the Employees Provident Fund Organization (EPFO) has been able to resolve 94.41 lakh claims, thus disbursing over ₹35,445 crore to its members during the period from April to August 2020.
During this period, EPFO has settled around 32% more claims compared to the corresponding period last year (April-August 2019), while the amount disbursed increased by around 13%.
“To help its members overcome liquidity needs during this crisis, EPFO accelerated the resolution of COVID-19 advances and disease-related claims. It introduced automatic mode of settlement for these two categories of advances. Automatic settlement mode reduced the claims settlement cycle to just 3 days for most claims in these two categories against the legal requirement to resolve claims within 20 days. In particular, 55% of early claims resolved during April-August 2020 were related to the Covid-19 advance recently introduced, while around 31% of the advances settled during the period corresponded to sickness claims, “the Ministry of Labor and Employment said in an official statement.
75% of Covid-19 advances and 79% of sickness claims have been settled for FP subscribers earning monthly salaries below ₹15,000, the government said.
“The salary analysis highlights that almost 75% of COVID-19 advances and approximately 79% of disease-related claims were settled for FP subscribers who belong to a salary slab of less than Rs 15,000. The timely availability of FP advances prevented many low-wage workers from borrowing, providing social security support to the weakest section of the workforce during these adverse times, “the ministry further said.
Requests for partial withdrawal or advances under the EPF scheme have more than doubled, with data reflecting growth of around 212% for the period April-August 2020 compared to April-August 2019.
While there was an increase in the number of anticipated claims, there was a significant decrease of around 35% in the number of PF final settlement claims for the April-August 2020 period compared to April-August 2019. Final PF agreement allows members to withdraw their PF balance after leaving their job, retirement, termination or at the time of retirement.
With EPFO settling anticipated claims within 3 days, PF accruals are now considered liquid assets that can timely meet the needs of underwriters during a crisis. Consequently, members have shown greater confidence in EPFO by not opting for final withdrawal or account closure rather than choosing to request PF advances to meet their financial needs.
“This trend of decrease in final claims settlement and increase in anticipated claims should also be seen in light of EPFO’s persistent outreach programs through print and digital media, as well as the organization of around 4880 seminars. web during the pandemic. This has been combined with service excellence through automated claim resolution, automatic transfer of funds at job change, introduction of multi-location claim resolution, regular member KYC update , ease of filing claims through the Umang app, and a robust grievance redress mechanism. Through this game – changing initiatives, EPFO has been able to serve the needs of its subscribers and therefore supported firmly to them during this critical period, ”the ministry added.
EPFO has more than 6 million subscribers, 66 lakh from retirees and 12 lakh from employers.
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