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Friday, 25 January 2013

Aadhaar Card A Mandatory KYC for New EPFO Members


Wish you all a very Happy Republic Day from PI Manpower. We always endeavor to make our nation proud and will always do. Today we come up to you with a big news buzzing from the EPFO Office.

New members joining the EPFO's retirement fund scheme will have to necessarily furnish Aadhaar number as KYC (Know Your Customer) credential for enrolment from March 1, 2013. The Employees Provident Fund Organization (EPFO), which serves around 13 crore employees and is the world's largest social security scheme, has decided that from March 2013 all new members should have an Aadhaar card. However for current members, the procedure of Aadhaar number has to done in a time bound manner," an official order to the field staff said.

EPFO joins hands with Aadhaar
Last month, it had released directions for linking the payment of EPF benefits to current members with the Aadhaar card. This relates to 43 districts where the government is applying its direct cash transfer scheme for subsidies on pilot basis. However, the December 31 deadline for the job has not been met.

While government seems to be driving the Aadhaar card scheme through EPFO, sources within the organization said that it might lead to a huge chaos in the beginning. Getting new members is an ongoing process but not everybody has an Aadhaar card yet, said the source. The EPFO order asks field offices to contact the Unique Identification Authority of India (UIDAI), the agency providing Aadhaar cards, to hold camps in commercial and industrial areas or other suitable centers to provide workers with cards. The field offices have been directed to coordinate with district bodies too, says the order.

In case any worker does not have issued the Aadhaar number, the employer can issue an Enrolment Id (EID) as per the recommendations of the body. This EID would be switched into Aadhaar number later on, the order said. The body would also look the Aadhaar numbers of its pensioners through the banks. EPFO has made the decision to use Aadhaar as compulsory KYC credential to enhance its services. The pensioner can submit their Aadhaar number either to their pension paying branch of the bank or to the EPFO office.

Previously, EPFO had thought of replacing its members account number with the Aadhaar numbers to ignore inconvenience of members as they had to apply for transfer of PF money to the new account with the new employer.

EPFO is working on to create a master data base where all members would have a unique account number and would not require to switch PF accounts to another one on changing job. Besides, this would help the members, particularly the construction workers, who often change their jobs or contractors.

Sources within the organization said connecting Aadhaar with EPFO would only complicate work. "Ensuring that each one gets Aadhaar card cannot be EPFO's mandate, which is basically assigned to implement the EPF Act," said an official here. A large number of workers are situated in distant areas, where Aadhaar was yet to reach, said a senior official in the ministry of labour.

Over five years ago, EPFO had released a project similar to Aadhaar which was ceased. The national social security number was anticipated to be unique identification number for EPF members. The entire project was discontinued after payment disputes and other issues jumped up with Siemens, the company providing the technical infrastructure.

Share Your Views With UsWe would like to hear your views on the addition of Aadhaar as a necessary KYC for the EPFO members. 

You may write to us at connect@pimanpower.com. 

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