Retirement body Employees Provident Fund of India has inked an agreement with 5 banks for the collection of provident fund dues of its subscribers. The banks include biggies Bank of Baroda (BoB), HDFC Bank, ICICI Bank, Kotak Mahindra Bank and Axis Bank. The arrangement would help EPFO save to the tune of ₹125 crores in a year. In addition, it would enable the EPFO, having a corpus of 12 lakh crore with 4.5 crore contributing members, to fasten its pace of investments along with the payment of dues to its subscribers. So, all those employers registered to the EPFO having the bank account in these banks are allowed to deposit the provident fund dues directly in the account of the retirement body. The employers can use Internet banking to transfer the dues as opposed to the previous mode of routing the money through aggregators. Without this facility, the EPFO needs to collect dues and make the payment of the same through aggregators at a cost fetching approximately ₹12 on each transaction. The transaction charges would now be reduced to ₹50 crore a year, continuously falling from ₹350 when only SBI was into the agreement for such a facility, according to Central Provident Provident Fund Commissioner V P Joy.
Talks on With Other Banks
The negotiations are on with seven more banks-IDBI Bank, Canara Bank, Indian Overseas Bank, Corporation Bank, Bank of Maharashtra, Central Bank of India and Bank of India. If a tie-up happens with these banks, the transaction charges would cost much lesser, he told. Labour Minister Bandaru Dattatreya, present in the event, added to the news by saying that the EPFO could think of reducing the administrative charges in the wake of reduction in transaction costs.