Prime Minister Narendra Modi on October 16 launched provident fund portability through the Universal Account Number (UAN). This new facility will help over 4 crore subscribers to transfer the funds lying in their provident fund accounts when they change jobs.
Top 10 facts:
1. The Universal Account Number is key to provident fund portability and easier PF transfer. The UAN will be portable throughout the working career of employees and can be used anywhere in India. Till now, every time employees changed jobs, they had to change their provident fund accounts.
2. This Universal Account Number will be linked to employees’ provident fund accounts. Employees would not be issued a new provident fund account number on joining a new firm. Instead, they would get a member identification number which would be linked to the UAN. This will help in smoothening out the process of provident fund transfers on changing jobs.
3. This new process is expected to help employees transfer their PF money instead of withdrawing it when they change jobs.The provident fund accounts of employees will be now be updated monthly and at the same time they will be informed through SMSes.
4.Initially, UAN will be has been allotted to employees whose PF contribution was received between 1 January and June 30, 2014, Employees’ Provident Fund Organisation said on its website.
5. The Universal Account Number (UAN) however becomes portable only when it is seeded with Know Your Customers (KYC) details like bank account number, PAN, Aadhaar etc verified by the employer.
6. Employees can check if UANs have been allotted to them on the Employees’ Provident Fund Organisation’s (EPFO) website or with their employers.
7. Then they need to activate their UANs on the EPFO website to download UAN cards, view updated PF account, file and view transfer claims, and also update KYC information.
8. The launch of Universal Account Number will also enable subscribers to consolidate all their previous accounts. Approximately Rs 27,000 crore is currently lying with Employees’ Provident Fund Organisation (EPFO) in inoperative accounts.
9. Inoperative accounts are those where there have been no contributions for the last three years and they earn no interest.
10. Universal account number has long been a pending demand of even employers. It is expected that the operationalision of allotment and deployment of the UAN will substantially lower the cost of compliance and save the employer from verification of various claims made by employee to EPFO.