EPFO is working on a voluntary provident fund framework for self-employed people, gig workers and those employed in the unorganised sector. The proposed scheme could bring millions of workers under a structured retirement savings system.
Highlights
- EPFO is considering a universal provident fund scheme.
- Self-employed individuals may be allowed to contribute voluntarily.
- Gig and platform workers could also become eligible.
- Unorganised-sector workers may receive access to retirement savings.
- Workers in exempted establishments could be included.
- The proposal is currently at an early stage.
The Employees’ Provident Fund Organisation is reportedly working on a new framework that could extend provident fund benefits beyond salaried employees in the organised sector.
Under the proposed universal provident fund scheme, self-employed individuals, gig workers, freelancers, small business owners and workers from the unorganised sector may be allowed to make voluntary contributions towards their retirement savings.
At present, the Employees’ Provident Fund is mainly associated with salaried employees working in eligible organised-sector establishments. This leaves millions of people working independently or in informal jobs without access to the same structured retirement savings system.
The proposed framework aims to address this gap by allowing workers outside the traditional employer-employee system to join the provident fund network voluntarily.
Gig workers associated with app-based delivery, ride-hailing and other digital platforms could potentially benefit from the scheme. Freelancers, shop owners, independent professionals and daily-wage workers may also be covered if the proposal receives approval.
The framework could also include workers employed in exempted establishments. Such establishments operate their own provident fund trusts after receiving approval from the authorities.
Details regarding the minimum contribution, withdrawal rules, interest rate, eligibility conditions and government support have not yet been finalised. The proposal is currently in its early stages and may undergo further discussions before being formally introduced.
A universal provident fund could significantly expand India’s social security network. Workers would get an opportunity to build a long-term retirement corpus through a regulated and trusted institution.
The scheme may be especially useful for people whose income is irregular and who do not receive employer-sponsored retirement benefits. Voluntary contributions could give them greater flexibility to save according to their earnings.
However, the success of the scheme would depend on simple enrolment, flexible contribution rules and easy access through digital platforms. Awareness among informal workers would also play an important role.
India has a large workforce employed outside the organised sector. Many of these workers do not have regular pensions, provident fund accounts or adequate retirement savings.
If implemented effectively, the proposed EPFO scheme could bring millions of such workers into the formal social security system and help them build greater financial security for their retirement years.
