The Hindu : EPFO permits transfer of PF to LIC scheme

Online edition of India's National Newspaper
Wednesday, Aug 20, 2003

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EPFO permits transfer of PF to LIC scheme

By Our Staff Correspondent

NEW DELHI AUG. 19. The Employees Provident Fund Organisation (EPFO) today decided to allow transfer of 90 per cent of the subscribers Provident Fund (PF) towards the "Varishta Pension Bima Yojana," launched by the Prime Minister, Atal Behari Vajpayee, last month.

The scheme was given a green signal by the EPFO at a meeting of its members here. This would ensure a steady flow of income to the senior citizens by way of pension from two sources and prevent the PF money from being `used up' on retirement.

The subscribers will be allowed to withdraw 90 per cent of their accruals upon reaching 55 years and subsequently invest it in the "Varishta Pension Bima Yojana" that allows a high return rate of nine per cent on the investments. The "Yojana," being promoted by the Life Insurance Corporation of India (LIC) with a minimum age limit of 55 years, can be bought for Rs. 33,335 for getting a monthly pension of Rs. 250 and a maximum of Rs. 2,77,490 for getting a pension of Rs. 2,000 a month. Since, the PF is also being linked to the pension scheme, a subscriber will get pension from two sources.The transfer of the PF to the insurance scheme will be carried out on payment of a minimal transaction cost, the details of which are being worked out with the LIC.

The meeting also approved giving of Social Security Number to the workers in the unorganised sector to bring them under the purview of the special medical scheme for the economically backward people. The Prime Minister had unveiled this scheme too.

Once the labourer gets a Social Security Number, he will be entitled for a medical cover, the cost of which will be equally shared by the EPFO and the subscriber. The scheme was earlier applicable to workers in the organised sector only.

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