EPFO's major decision for lakhs of inactive accounts: Rs 30.52 crore dues will be released without application... Find out who will benefit?
There's good news for lakhs of employees and their families across the country. The Ministry of Labor and Employment has decided to refund the funds lying in over 7.11 lakh inactive accounts of the Employees' Provident Fund Organization (EPFO). Each of these accounts has a balance of up to Rs 1,000, which had remained unclaimed for a long time.
According to government sources, this decision was made after a recent review meeting. A total of Rs 30.52 crore is lying in over 7 lakh inactive accounts, which will now be returned to the respective account holders or their legal heirs.
Who will benefit?
Employees whose EPF accounts are Aadhaar-seeded will have this amount transferred directly to their bank accounts. No separate application will be required for this. If an EPF account holder has died, this amount will be given to their nominee or legal heir.
The EPFO has clarified in an official social media post that if a member dies while in service, their account becomes inactive after three years from the date of death. Therefore, family members should file claims on time to avoid losing interest.
Legal experts say this move is a special relief for employees whose accounts have not received any employer contributions for the past three years. Such accounts with small balances were previously considered closed or inactive, allowing funds to remain stagnant for years.
What is an inoperative EPF account?
An EPF account is considered inoperative when:
The employee retires and there are no transactions for three years
The employee permanently migrates abroad
The account holder dies and no claim is made for three years
However, according to current rules, interest continues to accrue on all accounts until the account holder reaches the age of 58. However, if the account is declared completely inactive and remains unclaimed, the funds may remain frozen.
Does interest accrue on an inactive account?
Normally, inactive accounts do not receive separate interest. However, currently, according to EPFO rules, interest continues to accrue on accounts until the member reaches the age of 58. Therefore, it is important to check the account status promptly and take necessary action.
What to do if your account becomes inactive?
If you are still employed in an organization covered under the EPF & MP Act, 1952, you can transfer the funds from your old account to a new account online or offline. If you have retired, you can withdraw the entire amount. This process has been simplified significantly through the EPFO portal and the UMANG app.
EPFO 3.0: A Major Initiative for Digital Transformation
The government has launched the “EPFO 3.0” project to make EPF services faster and more transparent. This is a major digital transformation initiative aimed at reducing paperwork and speeding up the claims settlement process. Under the new system, necessary risk management verifications will be completed automatically, reducing the time taken for manual settlement from up to 20 days to less than three days.
In April 2025, the EPFO also launched the Universal Account Number (UAN) generation and activation facility through Aadhaar Face Authentication Technology (FAT). This service is available through the UMANG mobile app, allowing members to manage their accounts securely and digitally without any physical contact.
Why is this decision important?
This government move will not only provide relief to lakhs of small account holders but will also streamline EPFO records. Small amounts deposited in long-dormant accounts were returned, which will promote both transparency and trust. This initiative is considered another important step towards Digital India and social security reforms. This is also a message for employees to regularly check their EPF account status, keep their Aadhaar and bank details updated, and file timely claims.