In a startling revelation, it has been revealed that the Employees’ Provident Fund Organisation (EPFO) has rejected every third claim that it received, reported Indian Express.
A number of subscribers have raised their grievances relating to delay in claim settlement on the official X handle of EPFO, which is the world’s largest social security organisation with over 277 million accounts and a corpus of nearly ₹20 lakh crore.
The pension body, in response to one such query, stated that it normally takes 20 days to settle a claim or release the PF amount if the same submitted to the concerned EPFO office is complete.
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Out of the total 73.87 lakh claims received for final PF settlement in financial year 2022-23, 33.8 per cent (24.93 lakh) were rejected. At the same time, 46.66 lakh were settled and 2.18 lakh remained as closing balance, shows official data.
This was considerably higher than the rate of rejection in 2017-18 and 2018-19, when it stood at nearly 13 per cent and 18.2 per cent, respectively.
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The rate of rejection, in percentage terms of rejected claims out of total applications for claims, jumped further to 24.1 per cent in 2019-20 and 30.8 per cent in 2020-21 for final settlement claims.
Moving to 2021-22, the rate of rejection for final settlement claims rose to 35.2 per cent i.e., more than one-third of the total number of claims that the pension body received.
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Working under pressure
Meanwhile, officials from the Employees’ Provident Fund Organisation (EPFO) in October last year had expressed their concern about being under “extreme pressure” . This pressure stems from the recent reversion to manual annual account updates by the EPFO, while they are held accountable for any delays in claim settlements beyond the stipulated 20-day timeframe.
The chief cause of this issue was attributed to the organisation’s outdated IT system, which was perceived as obsolete by the staff of pension fund body.
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Announcement of interest
Additionally, the Central Board Trustees EPFO on Feb 10 recommended an annual rate of interest of 8.25 per cent to be credited on EPF accumulations in members’ accounts for the financial year 2023-24.
The Board also recommended a distribution of income of ₹1,07,000 crores to EPF members’ accounts on a total principal of around ₹13 lakh crores. The total income recommended for distribution was the highest so far.
