EPS new rules: Starting January 1, 2025, pensioners covered by the Employees' Pension Scheme (EPS), 1995, will have the convenience of accessing their pensions from any bank branch in India affecting 7.8 million members of EPS. This follows the approval of the proposal for a Centralized Pension Payment System (CPPS) for the Employees’ Pension Scheme, 1995, by the Employee Provident Fund (EPF).
The introduction of CPPS represents a significant shift in the pension disbursement process in India, as it provides a centralised platform that allows pension payments to be made through any bank or branch nationwide.
The final approval from the Ministry of Labour and Employment was granted on November 10, 2024, as a component of comprehensive reforms aimed at modernizing the EPS framework. The suggestion was born out of the increasing complaints from pensioners who encountered obstacles in receiving their pensions outside of their assigned branches. Through the utilization of centralized technology, the government aimed to efficiently tackle these issues.
Regardless of a pensioner's relocation or change in banking preferences, CPPS guarantees seamless and uninterrupted distribution of pension funds throughout the country, eliminating the necessity to transfer Pension Payment Orders (PPO) between different offices.
With this new system in place, pensioners will no longer be restricted by geography when receiving their pensions. They can now avail themselves of their benefits from any bank or branch in the country without the need to transfer Pension Payment Orders (PPOs). Pensions will be promptly credited without the necessity for branch visits or additional verification.
As outlined in a press statement from the Press Information Bureau on September 4, 2024, EPS pensioners will have the flexibility to collect their pensions from any bank, branch, or location in India, starting January 1, 2025.
In the past, pensioners were restricted to a small number of banks in a decentralized system. However, with the introduction of the CPPS, pensioners will enjoy increased flexibility and convenience.
Moving forward, the shift to an Aadhaar-based payment system (ABPS) will enhance the efficiency of pension disbursements.
How will pensioners benefit
Pensioners no longer need to physically visit a bank branch for verification and can expect their pensions to be credited promptly upon release. In the past, when a pensioner relocated to a different town after retiring, they were required to transfer their pension payment orders to a new office or change their banking details.
With the implementation of CPPS, all such administrative tasks have been eliminated. Additionally, the previous practice of EPFO zonal offices having exclusive agreements with only a few banks is being gradually discontinued.
The update will significantly impact pensioners living in rural or remote areas by decreasing reliance on a single branch and guaranteeing access to funds in underserved regions. Additionally, this initiative is in line with the government's focus on digitization and improving the distribution of public services.