In a recent report by the Indian Express, it was disclosed that the Employees' Provident Fund Organisation (EPFO) witnessed a substantial rise in the rejection rate of claims, soaring from 13% to a staggering 34% over the span of five years. This revelation has sparked concerns among subscribers and shed light on the challenges faced by the world's largest social security organization, managing over 277 million accounts and a corpus of nearly Rs20 lakh crore.

 

Many subscribers have voiced their grievances regarding the delay in claim settlement through EPFO's official handle on social media platforms. Responding to one such query, the pension body clarified that it typically takes 20 days to process and release the Provident Fund (PF) amount if all required documents are duly submitted to the EPFO office.

 

Official data for the financial year 2022-23 revealed that out of a total of 73.87 lakh claims received for final PF settlement, a staggering 33.8% (24.93 lakh) were rejected. Comparatively, in 2017-18 and 2018-19, the rejection rates stood at approximately 13% and 18.2%, respectively. However, the rejection rate witnessed a significant surge in subsequent years, reaching 35.2% in 2021-22.

 

The escalating trend in rejection rates over the past five years has raised concerns, despite a marginal decrease observed from 2021-22 to 2022-23. EPFO officials, acknowledging the pressure they face, attributed the issue to the organization's outdated IT system, deemed obsolete by the staff.

 

Furthermore, the EPFO Central Board Trustees, in a recent announcement, recommended an annual interest rate of 8.25% to be credited on EPF accumulations in members' accounts for the financial year 2023-24. Additionally, a distribution of income of Rs1,07,000 crores was proposed to be allocated to EPF members' accounts, marking the highest total income recommended for distribution thus far.

 

Addressing the challenges faced by EPFO, there is a pressing need for modernization and digitization of the organization's IT infrastructure to streamline claim settlement processes and reduce rejection rates. Additionally, adequate training and support for staff members can help mitigate operational challenges and ensure timely and efficient service delivery to subscribers. By implementing these measures, EPFO can strive towards achieving its objective of providing seamless social security benefits to millions of employees across the country.