Introduction
The Employees’ Provident Funds (EPF) Scheme, 2026 is the new statutory provident fund scheme notified by the Central Government under the Code on Social Security, 2020. It replaces the Employees’ Provident Funds Scheme, 1952 and came into force on 29 June 2026. The Scheme modernises the EPF framework by incorporating digital processes, simplified withdrawal rules and recent EPFO reforms while retaining the core provident fund structure.
Objectives
- Provide retirement income security to employees.
- Promote compulsory savings among organised-sector workers.
- Simplify EPF administration through digital governance.
- Enhance transparency, portability and ease of compliance.
- Align the provident fund framework with the Code on Social Security, 2020.
Coverage
The Scheme applies to:
- Employees and establishments covered under the Code on Social Security, 2020.
- Establishments notified by the Central Government.
- Eligible employees working in covered establishments.
Key Features
Digital-First Framework
- Greater emphasis on:
- Electronic filings.
- Online claims.
- Digital passbooks.
- Universal Account Number (UAN)-based services.
- Aadhaar-enabled authentication.
Provident Fund Contributions
- Employee Contribution: 12% of wages.
- Employer Contribution: 12% of wages.
- The existing 10% contribution rate continues for notified establishments where applicable.
Voluntary Contributions
- The Scheme expressly recognises voluntary contributions above the statutory wage ceiling, subject to prescribed conditions.
Simplified Withdrawals
The Scheme consolidates and simplifies provisions relating to partial withdrawals (advances) for purposes such as:
- Medical treatment.
- Education.
- Marriage.
- Housing.
- Other specified needs.
The recent EPFO reforms on withdrawal categories have been incorporated into the Scheme.
Nomination
- Updated and streamlined provisions relating to e-nomination and succession.
- Greater clarity regarding nominee rights and procedures.
Automatic Account Portability
- Facilitates seamless transfer of EPF accounts when employees change jobs, subject to fulfilment of KYC requirements.
Significance
Modernisation
Replaces a seven-decade-old framework with a digitally enabled system.
Ease of Doing Business
Simplifies employer compliance and electronic record management.
Financial Inclusion
Improves access to provident fund services through digital platforms.
Portability
Makes job transitions easier through automatic transfer of EPF accounts.
Transparency
Enhances online tracking, digital claims and paperless processing.
Challenges
- Digital literacy gaps among workers.
- Dependence on Aadhaar-linked KYC and digital infrastructure.
- Transition challenges during implementation.
- Need for awareness regarding revised withdrawal and nomination provisions.
Way Forward
- Strengthen digital infrastructure and cybersecurity.
- Increase awareness regarding the new Scheme.
- Ensure timely settlement of claims.
- Improve grievance redressal mechanisms.
- Continue simplifying compliance for employers and employees.
Conclusion
The Employees’ Provident Funds Scheme, 2026 marks a significant reform of India’s provident fund system by replacing the EPF Scheme, 1952 with a modern, digital and user-centric framework under the Code on Social Security, 2020. While retaining the core objective of providing retirement savings and social security, it enhances transparency, portability, ease of compliance and access to EPF services for both employees and employers.
