EPFO

EPFO

TOPIC: Economy

Context- The Employees’ Provident Fund Organisation will meet on March 4-5 in Guwahati to decide on the interest rate for its subscribers for the financial year 2021-22.

Concept-

Employees’ Provident Fund Organisation (EPFO):

• It is a government organization that manages provident fund and pension accounts of member employees and implements the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952.
• It is administered by the Ministry of Labour & Employment, Government of India.
• It is one of the World’s largest Social Security Organisations in terms of clientele and the volume of financial transactions undertaken.

Employees Pension Scheme (EPS):

• It is a social security scheme that was launched in 1995.
• The scheme, provided by EPFO, makes provisions for pensions for the employees in the organized sector after the retirement at the age of 58 years.
• Employees who are members of EPF automatically become members of EPS.
• Both employer and employee contribute 12% of employee’s monthly salary (basic wages plus dearness allowance) to the Employees’ Provident Fund (EPF) scheme.
• EPF scheme is mandatory for employees who draw a basic wage of Rs. 15,000 per month.