EPFO holds ₹8,505 crore in inoperative accounts, a five-fold surge since 2018-19

The Employees’ Provident Fund Organisation (EPFO) is holding ₹8,505.23 crore in inoperative accounts as of March 2024, over five-fold from Rs 1,638.37 crore in fiscal year 2018-19, Parliament was informed on Monday. The number of inoperative accounts has also grown from 6.91 lakh in 2018-19 to 21.55 lakh this year.

The accounts are classified as “inoperative” when contributions stop for a certain period, often due to employees failing to transfer or claim their funds while switching jobs or upon retirement.

Replying to questions from MPs Manish Tewari and Asaduddin Owaisi, Minister of State for Labour and Employment Shobha Karandlaje clarified that every inoperative account has a definite claimant.

“All such inoperative accounts have definite claimants and whenever such a member files a claim in EPFO, the same is settled after scrutiny,” she said in a written reply.

She told the House that the EPFO would return the amount held in the inoperative accounts to the beneficiaries concerned.

In 2023-24, the EPFO processed 47.58 lakh final settlement claims and 78.23 lakh transfer claims, the highest in the last five years.

To curb the growing number of dormant accounts, the government is ramping up awareness efforts. Initiatives include the “Nidhi Aapke Nikat 2.0” program, monthly YouTube live sessions, webinars, and local language campaigns through regional YouTube channels. These steps aim to ensure employees understand how to manage their EPF accounts and avoid losing track of their funds.

The minister also addressed concerns about the reach of the new scheme for first-time workers, which includes a one-month wage subsidy. She confirmed that the benefits extend to employees in the unorganised sector, provided they register with the EPFO.

The EPFO administers three social security schemes namely -- Employees' Provident Fund Scheme 1952, Employees' Pension Scheme 1995 and Employees' Deposit Linked Insurance Scheme 1976.