As new financial year came, starting with the 1st April Employees' Provident Fund Organisation (EPFO) has introduced a system that gives a hassle free PF Transfer for Job Movers. The system operates by linking the employee's Universal Account Number (UAN) with their KYC details. When a new employer makes the first contribution, the PF balance is automatically transferred to the new employer's PF account, provided the UAN is fully compliant with KYC requirements.
Decoding How PF transfer process was before the recent automatic transfer system
Earlier, the process of transferring PF balances was done by following manual steps and paperwork, which leads to delays and inconvenience for employees changing jobs. The introduction of the Universal Account Number (UAN) aimed to streamline this process and make it more efficient.
Here's how the PF transfer process worked before the recent automatic transfer system
| By Activating of UAN | Employees are required to activate their UAN on the UAN portal and ensure that the mobile number used for activation was active. |
| Linking Bank Account and IFSC Code | Bank account details and the IFSC code needed to be linked against the UAN to facilitate electronic transfers. |
| Linking Aadhar Number and PAN | Linking Aadhar number and PAN against UAN was not mandatory for raising transfer claims, it likely to helped in verifying the identity of the employee. |
| Employer Approval | The employer had to approve the e-KYC (Know Your Customer) process, which involved verifying the employee's identity electronically. |
| Authorized Signatories | The previous and current employers were required to have digitally registered authorized signatories in the EPFO system to facilitate the transfer process. |
| PF Account Numbers | The PF account numbers of both the previous and current employment of an employee had to be entered into the EPFO database. |
| Single Transfer Request | Only one transfer request against the previous member ID was accepted, ensuring that multiple requests for the same transfer were avoided. |
| Correct Information | It was essential for personal information and PF account-related information shown in the EPFO database to be accurate to prevent any discrepancies or errors in the transfer process. |
Let us know how Automatic PF Transfers are done now
Presently with the new EPF rules:
- When an employee changes jobs, a new EPF account is opened with the new employer.
- To transfer funds from the previous EPF account-
- The employee must link their Universal Account Number (UAN) with Aadhaar and then initiate the transfer online via the Member Sewa portal.
- If UAN isn't linked with Aadhaar, the transfer must be done offline by submitting a form to the new employer.
- Transferring the EPF account ensures accurate calculation of the continuous service period for pension under the Employees’ Pension Scheme (EPS) and for income tax purposes. It is essential for maintaining a seamless record of employment and benefits accumulation.
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