Employees’ Provident Fund Organisation (EPFO) is likely to propose open up subscription to members who exited the scheme with a contribution as low as Rs 500 a month to those who lost jobs or moved out of choice.
Work has started within the EPFO to draw a model that will enable individuals, who were earlier members of the organisation, to join back with a minimum monthly contribution of Rs 500 or 12% of their monthly income, as reported by ET.
“We are trying to assess the impact of this on pension (EPS), provident fund (EPF) and the employees deposit-linked insurance scheme of EPFO. An actuary analysis is being done following which the scheme will be finalised,” an official said on the condition of anonymity.
If the proposal goes through, it could be a major relief for millions of workers. It will help individuals build a retirement corpus, offering fixed returns at a relatively higher rate than any other deposit schemes, and boost EPFO corpus and subscriber base. Individuals who enrol into the EPF scheme will be able to draw benefits of pension, PF and insurance.
Further, they would be eligible for a fixed rate of return basis on returns yielded on investments of EPFO during the year. EPFO has given 8.5% interest for FY21.