Automatic PF Transfer On Job Change

Automatic PF Transfer On Job Change

A few decades ago, life inched forward at a monotonous pace. People took pride in working for the same employer until they retired and change wasn’t accepted as readily as it is today.

But a tidal wave of privatisation upended everything and people started jumping jobs to bag positions in MNCs that offered lucrative pay packages and a relatively more independent work culture.

But this posed one mega problem that made everybody cringe. The provident fund transfer process. The world had moved on but the government PF department was still working at snail’s pace. Top this with cumbersome paperwork. It, therefore, became impossible to keep a track of the number of PF accounts held by an individual and the amount in each account.

Thanks to digitisation and the internet, it is much easier to transfer PF when you switch jobs. It’s pretty much automatic now. But before we look into the process let’s get a quick understanding of a few important terms.

What is EPF? 

EPF (Employee Provident Fund) is a contributory retirement savings scheme provided by the Government of India. The scheme aims to provide social security to people in their sunset years, irrespective of whether they are entitled to a pension or not.

Under the EPF scheme, an employee is required to contribute a certain amount towards the scheme and an equal contribution is made by the employer. The employee gets a lump sum amount including self and employer contribution with interest on both, on retirement.

Universal Account Number – UAN

A Universal Account Number (UAN) is a 12-digit code allotted to employees whose employers are making contributions towards EPF. The number once allotted does not change for an employee during the course of his/her lifetime.

The allotment of UAN is done by the EPFO provided that the employer of an individual makes the requisite EPF contribution. If an individual does not possess a UAN then the employer must request for the same and the EPFO will generate one within two months. Along with the UAN, the EPFO will also provide a Member ID which allows an employer to deposit their employees’ EPF money. The Member ID, unlike the UAN, changes with every change in job.

Automatic PF transfer

The Employees’ Provident Fund Organisation (EPFO) has taken some steps to make the PF transfer process completely hassle-free. Going forward, when people change jobs, all they have to do it furnish a few details to their new employer. The new employer is expected to upload these details on EPFO platform and this will automatically initiate a transfer of PF amount of the employee from the old to the new account. With the introduction of this process, the responsibility shifts to the employer to ensure correct and seamless transfer of the provident fund of the employee.

Here’s a look at the process in detail

When you join a new company, your employer will ask you to fill a ‘Composite Declaration Form’ also called F-11. Along with your basic details, you’ll be asked to fill your UAN as well. Make sure you enter the right UAN as this is crucial for automatic transfer of your PF. Your employer will be referring to the form to update details on the EPFO platform.

At this point, it’ll help if your UAN is linked to your Aadhaar number and bank account and also verified by your previous employer. Once all the three checks come in the green, a message regarding the auto-transfer process will be sent to your mobile number. Keep in mind, the transfer will be initiated only if:

  • A request to stop the auto transfer is not received from your within 10 days of receiving the message
  • Your new employer makes their first deposit contribution to your new PF account

Keep in mind, if you UAN is not verified by your previous employer, then you have to take the offline route to get your PF amount transferred.

Now, a lot of people choose to withdraw their PF. If you are among them or have received cash windfall and are looking for investment options for the same, then we can definitely help. Explore a range of Mutual Fund and other investments options you can choose from. Start now!

Source by:-bankbazaar


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