The Universal Account Number (UAN) for provident fund accounts, launched by Prime Minister Narendra Modi on Thursday, will help over 40 million subscribers easily transfer the funds lying in their provident fund accounts when they change jobs.
The Universal Account Number will make provident fund account transfers easier throughout the working career of employees as the account can be ported anywhere in the country using the UAN.
Till now, every time employees changed jobs, they had to change their provident fund accounts manually.
This Universal Account Number, which will be linked to employees' provident fund accounts, will remain unchanged throughout the term of the account and employees will continue to use the provident fund account number on joining a new firm.
Instead of renewing the account number, they would get a member identification number which would be linked to the UAN. This will help ease the process of provident fund transfers on changing jobs.
Also, the provident fund accounts of employees will be now be updated monthly and at the same time they will be informed through SMSes.
Initially, UAN will be allotted to employees whose PF contribution was received between 1 January and 30 June 2014, Employees' Provident Fund Organisation said on its website.
The Universal Account Number (UAN) however becomes portable only when it is seeded with Know Your Customers (KYC) details like bank account number, PAN, Aadhaar etc verified by the employer.
Employees can check if UANs have been allotted to them on the Employees' Provident Fund Organisation's (EPFO) website or with their employers.
Then they need to activate their UANs on the EPFO website to download UAN cards, view updated PF account, file and view transfer claims, and also update KYC information.
The launch of Universal Account Number will also enable subscribers to consolidate all their previous accounts.
An estimated Rs27,000 crore is currently lying dormant with Employees' Provident Fund Organisation (EPFO) accounts.