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EPFO Assistant Exam 2019 – 3 Schemes offered by EPFO

Schemes by EPFO - EPFO Assistant Exam 2019

With a total of 280 vacancies announced for the post of Assistant in Employee Provident Fund Organization (EPFO), it is a great opportunity for the Government job aspirants. The pattern of the EPFO Assistant 2019 Exam is more or less similar to the Banking Exam pattern (sectional timing and descriptive paper). The preliminary exam is scheduled to happen on 30th & 31st of July 2019, thus leaving you with ample time to prepare for the EPFO Assistant Exam 2019. As said “The best preparation for tomorrow is doing your best today”. Thus it is advisable to start your preparations from today itself so that the syllabus is covered and there is enough time left for revision as well. In this blog post we will discuss Schemes by EPFO – EPFO Assistant Exam 2019 that come under the aegis of Employee Provident Fund Organization. There might be some questions from these schemes in the EPFO Assistant Exam. so read the blog “Schemes by EPFO – EPFO Assistant Exam 2019”. 

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Schemes by EPFO – EPFO Assistant Exam 2019

The three schemes offered by the Employees Provident Fund Organization are:

  1. Employees’ Provident Fund Scheme (EPF).
  2. Employees’ Pension Scheme (EPS).
  3. Employees’ Deposit Linked Insurance Scheme (EDLI).

EPFO Scheme

Employee’s Contribution

Employer’s Contribution

EPF 12 % of Basic + DA 3.67% of Basic + DA
EPS N/A 8.33 % of Basic + DA
EDLI N/A 0.5% (subject to a maximum of ₹ 75)

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1. Employees’ Provident Fund Scheme (EPF)

This scheme is offered to all employees working in the formal sector in India. The scheme comes under the aegis of EPFO. It comprises of contribution of a certain percent of one’s salary towards the Provident Fund. Both the Employer as well as the employee contribute on a monthly basis. The amount is directly deducted from the employee’s salary. The contribution made by the employee is equal to 12% of the basic salary while the contribution made by the employer is equal to 12% and 8.33%, subject to a maximum of Rs. 541 goes towards the EPS scheme and the remainder is added to the provident fund of the employee.

Salient Features of the Scheme

  • The contribution for the Scheme is made on a monthly basis.
  • The amount to be contributed towards this fund is fixed and is pre-decided along with the interest rates.
  • This amount can also be withdrawn by the nominee or the legal heir of the employee, post-death of employee or can be withdrawn by the employee post resignation. (Withdrawal is subject to conditions).

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Employee’s/Employer’s contribution to the scheme

The scheme includes equal contribution from both, the employer as well as the employee on a monthly basis. The fixed contribution rate depends upon the employee’s basic pay along with the dearness allowance received.

This rate of contribution stands at 12%. It might change to 10% subject to the following conditions:

  • The company only employs a maximum of 19 workers.
  • An Industry or company is declared as a sick mill by the BIFR (Board of Industrial and Financial Reconstruction)
  • The Industry or company is suffering annual losses higher as compared to its net market value.
  • It is a Coir, Guar gum, Beedi, brick or jute business.
  • An Industry or company is operating under a wage limit of ₹6,500 per head.

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Withdrawal Rules under the Employees’ Provident Fund Scheme

  1. The EPF account holder can use the balance in his Employees’ Provident Fund account if he requires funds for buying a house, construction, repair or renovations or payment of the housing loan.
  2. The EPF fund can be withdrawn for constructing or buying a new house. An employee can withdraw a maximum of 3 years’ wages from the EPF account after completing 5 years of service.
  3. One is allowed to withdraw from the balance of EPF account for meeting any medical emergency too.
  4. The EPF amount can be withdrawn for any personal expense such as marriage or higher education of the child.
  5. The EPF can also be used for buying equipments required for physically handicapped individuals. Withdrawals are allowed only for major surgeries and treatments or to individuals who are suffering from critical ailments such as cancer and heart related ailments.
  6. The EPF withdrawals are allowed only if the account holder has served for a minimum of 7 years in an organization.
  7. If the account holder wants to repay his housing loan, he can withdraw a maximum of 3 years’ wages from his account if he has completed 10 years of service.

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2. Employees Pension Scheme (EPS)

Employee Pension Scheme (EPS) is a social security scheme provided by the Employees’ Provident Fund Organisation (EPFO). The scheme is for employees who work in the organized sector in the Indian Economy and has provision for a pension after they retire after the age of 58 years. Under the Employee Pension Scheme (EPS), the entire contribution made by the employee is directed towards his/her provident fund account, while the contribution made by the employer is divided into 3 parts namely the Employees’ Provident Fund account, EPS account and EDLI account. The EPS was launched in the year 1995.

Salient Features of EPS

  • EPS does not attract any kind of interest and the funds deposited under EPS are totally interest free.
  • Employee Provident Scheme holder is not liable to make any kind of deposit in this account.
  • The Union Government contributes 1.16% of the wages as defined under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
  • This amount should be deposited with the exchequer within a span of 15 days of the end of the month.

Advantages of EPS

  • The entire pension amount is paid to the employee till retirement or till the time they are alive.
  • In case of death, the entire amount is transferred to the nominee/beneficiary or to the family of the employee.
  • In case of death, the children receive pension benefits only when they reach the age of 25 years.

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3. Employees Deposit Linked Insurance (EDLI) Scheme

An EDLI scheme is an assurance benefit scheme linked to the contributions made by the employee and the employer towards the Employees’ Provident Fund. It is a comprehensive group term insurance plan which was launched 1976. The main objective of EPFO behind launching this scheme was to ensure that the family of members covered under EPF get financial assistance in case of death of the member. There is no exclusion under this scheme. The insurance cover depends on the salary drawn in the last 12 months of the employment before death of the member.

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Salient Features of EDLI

  • The insurance benefits can be availed by the family members, legal heirs or nominees of the member.
  • Members of EPFO are automatically enrolled for EDLI.
  • An EPFO member is only covered by the EDLI scheme as long as he/she is an active member of the EPF. His family/heirs/nominees cannot claim it after he leaves service with an EPF registered company.
  • There is no minimum service period for availing EDLI benefits
  • The employer has to make the contribution for EDLI and no fee can be deducted from the employee’s salary
  • The claim amount under EDLI is 30 times the average monthly salary in the past 12 months subject to a maximum of 6 lakh (4.5 lakh basic + 1.5 lakh bonus).
  • The average monthly salary is calculated as the Basic + Dearness Allowance of the employee
  • A bonus of ₹ 1.5 Lakhs is also applicable under this scheme
  • The employer can opt out of the scheme in case he takes a higher paying life insurance scheme for employees under Section 17 (2A).

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Amount Payable to the Beneficiary under EDLI

The amount payable to the family/legal heir in case of death of the employee is calculated based on the Employees’ Deposit Linked Insurance (Amendment) Scheme, 2011.

The amount payable is defined as highest of the following:

  • 20 times the monthly salary of the deceased in the last 12 months immediately prior to the month of death.
  • There is a limit on the monthly basic salary which is Rs. 6,500. Thus, the maximum amount payable in this case is (6500*20) = Rs. 1,30,000.
  • The average balance in the Provident Fund Account of the deceased in the last 12 months immediately prior to the month of death.
  • If the average balance is lower than Rs. 50,000, then a minimum amount of Rs. 50,000 is payable to the nominee. However, if the average balance in Provident Fund Account is higher than Rs. 50,000, then the amount payable in this case would be Rs. 50,000 + 40% of the amount that exceeds Rs 50,000.
  • The aggregate of this computation should not be more than Rs. 100,000.
  • When a group insurance scheme is not provided by the employer, the employer is mandated to contribute 0.5% of the basic monthly salary of the employee subject to a maximum of Rs. 6,500.

The amount of insurance cover would be calculated as higher of the two things:

  • 20 times the average salary in the last 12 months provided the monthly basic salary is capped at Rs. 6,500.
  • The balance of the Provident Fund account up to Rs. 50,000 and then 40% of the remainder.

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Also Read:

This was all from us in this blog “Schemes by EPFO – EPFO Assistant Exam 2019″. We hope that the content of the blog proves of great utility to you and helps you in EPFO Assistant 2019 Exam. You can try our Free Mock Test and test the level of preparations for EPFO Assistant 2019 Exam. The Exam is gives candidates to become a part of central government organization therefore it is a golden opportunity for prospective candidates. You should not miss this chance. Hence prepare well and results will follow.

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