Lok Sabha Question No. 1305 (UNSTARRED), answered on 2025-07-28
Subject: EPFO Claim Rejections
Ministry: LABOUR AND EMPLOYMENT
Asked by: Shri Manickam Tagore B, Shri Suresh Kumar Shetkar, Shri Vijayakumar Alias Vijay Vasanth

## GOVERNMENT OF INDIA

## MINISTRY OF LABOUR AND EMPLOYMENT

## LOK SABHA UNSTARRED QUESTION NO. 1305 TO BE ANSWERED ON 28.07.2025

## EPFO CLAIM REJECTIONS

1305. SHRI VIJAYAKUMAR ALIAS VIJAY VASANTH: SHRI MANICKAM TAGORE B: SHRI SURESH KUMAR SHETKAR:

Will  the  Minister  of  LABOUR  AND  EMPLOYMENT  be  pleased  to state:

- (a)the  details  of  the  rationale  behind  the  EPFO's  decision  to  allow employees to self-declare reasons for partial withdrawals from their provident  fund  accounts,  and  the  manner  in  which  the  impact  the authenticity of claims;
- (b)the  details  of  the  number  of  claim  rejections  due  to  poor-quality document uploads before and after the introduction of the new claim settlement process in the form of Statistics;
- (c)the manner in which the EPFO ensure that the new system of selfdeclaration for provident fund withdrawals does not lead to misuse or
- fraudulent claims;
- (d)the  details  of  the  measures  that  have  been  taken  by  the  EPFO  to address the issue of claim rejections without clear explanations as highlighted by the EPFO grievance cell;
- (e)the details of the process of digitizing the joint declaration process for updating member details, and the manner in which this impacted the efficiency of claim settlements; and
- (f)the details of claim settlement timelines to achieve its target of 100
- per cent claim resolution in the near future?

## ANSWER

## MINISTER OF STATE FOR LABOUR AND EMPLOYMENT (SUSHRI SHOBHA KARANDLAJE)

- (a): The Composite  Claim Form  introduced in 2017 aims to rationalize the process of claiming advances/partial & final withdrawals by relying on 'self -certification' for this purpose reposing trust in the member.  Accordingly, no document substantiating the claim is required to be submitted to the EPFO offices.

- (b): In  the  new  simplified  settlement  process  the  requirement  of uploading the image of the cheque leaf/pass book was removed on 03.04.2025.  The  claims  rejected  due  to  poor  quality  document uploads for ensuring KYC/identity with regard to bank account has significantly reduced as tabulated below:-
- Over 1.9 Crore members have benefited from the simplified process since 22.07.2025.
- (c): All claims are filed only after member account is activated using Aadhaar OTP or Face Authentication. All payments pursuant to claim settlement  are  sent  to  bank  accounts  directly  verified  with  the concerned bank to ensure credit to member account only. A system of Concurrent Audit is being undertaken followed by Internal Audit as well as Statutory Audit to monitor any process violation.
- (d): Process simplification has been done to increase autosettlement of advance claims. The reasons for claim return/rejections have  been  rationalized  reducing  the  existing  44  reasons  to  18 reasons. A remarks column to facilitate entering of description of any other reason has also been provided
- (e): Under  the  revised  procedure,  the  members  whose  Universal Account Number (UAN) has already been validated through Aadhaar can  update  their  profile  online  like  name,  date  of  birth,  gender, fa ther/mother's name, marital status, spouse name etc. without any approval from employer or EPFO. This has resulted in facilitating the member to carry out self -corrections and removing errors in profile data which leads to easier claim settlement.
- (f): The auto settlement of claims processing limit under Paragraph 68J (Illness) of the EPF Scheme was enhanced from ₹50,000/ -to ₹1 Lakh in April 2024. Subsequently, advances/withdrawals for Housing and Marriage have also been included under the auto-settlement of claim facility and the limit all such advances/withdrawals has been increased  from  ₹1  lakh  to  ₹5  lakh  with  a  view  to  facilitate  more members availing speedy settlements. Claims under auto settlement process are settled within 3 days of receipt.

| Year    | Total No.   |
|---------|-------------|
| 2024-25 | 27,66,328   |
| 2025-26 | 3,29,084    |

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