The Employees’ Provident Fund Organisation (EPFO) has rolled out quite a remarkable update concerning the clearance of pending PF dues. Hence, for those employers who have not been able to get old payments out through the Electronic Challan-cum-Return (ECR) technology, they may now settle by one-off payment through Demand Draft (DD).
This is to clarify long-standing EPF dues, and therefore, ensures that employees get their dues without further inconvenience.
Why Did the EPFO Implement This Change?
The EPFO has opened a concession to pay through Demand Draft but emphasized that such outstanding dues should be settled through the ECR or Internet Banking as an alternative for the employers who have experienced technical issues in doing so.
Key Conditions for Demand Draft Payments.
In a circular dated April 4, 2025, the EPFO described certain terms concerning this one-off concession of payment via DD:
- The employer will make a written application to the concerned Regional Provident Fund Commissioner (RPFC).
- The Demand Draft will be made payable in favor of “RPFC-in-Charge” and payable at an EPFO local bank branch.
- There will have to be an appropriate undertaking by the employer along with a list of beneficiary employees to ensure transparency and enable future verification.
- Returns must always be filed along with payments to maintain accurate employee records. Every interest and penalty due will continue to apply.
EPFO has essentially cleared out the dues.
All dues will, therefore, attract interest and appropriate penalties according to the existing laws. Employers have to refer to the EPFO Compliance Manual for the proper calculation and payment.
How Does This Benefit Employees?
For stuck funds, many of your employees have been waiting for stuck PF funds that are stuck due to payment issues caused by the employer.
Allowing DD as a backup option will ensure that delayed PF contributions will be able to reach employees faster and build up their retirement savings and financial stability.