New norm

New Delhi, Jan. 3: The 12-digit unique identification (UID) number, which will be allotted to all Indians, will double up as the provident fund account number, as part of an ambitious initiative by the Employees’ Provident Fund Organisation (EPFO) to take all its subscriber accounts online.

The exercise will not only allow subscribers to track their accounts on the Internet but also speed up the transfer of funds in case of job change. Officials said all regional and sub-offices of the EPFO would be linked up by March next year, and the unique ID number would replace the PF account number then.

At present, when a subscriber changes job, it takes months to transfer money from one PF account to another as the records are required to be transferred from one office to the other. “Under these circumstances, a large number of subscribers often withdraw the entire money and go for a fresh account with the new employer,” officials said.

In a pilot study conducted at the EPFO office, it was found that over 30.2 per cent of subscribers withdrew their provident funds within a year of joining a new service, while 54.3 per cent do so by the end of the second year. The EPFO, which has a subscriber base of about 4.7 crore, processes over 60 lakh claims every year.

It manages about Rs 3 lakh crore and receives an incremental deposit of over Rs 25,000 crore every year.

“We are in the process of digitising and inter-connecting all our offices. We are planning to use UID as the subscribers’ account number after that,” labour secretary P.C. Chaturvedi said.

“Besides expediting the transfer of funds, it will help to reduce the number of withdrawals. Moreover, every subscriber will be able to track his account online.”

The EPFO aims to digitise data in its regional and sub-offices by March in the first phase and inter-connect all offices in the second phase. The move will enable the subscriber to apply for online transfer and withdrawal.

Multiple use

The UID project has found various other uses as a reliable identification proof.

While the finance ministry has said that the number will be adequate to open a bank account or conduct any other financial transaction, the telecom industry is likely to use the same number for subscriber verification.