EPF Accounts: What should you do if your account is inoperative? How to apply for refund?

Inactive EPF account: The Employees' Provident Fund Organisation (EPFO) reported to Parliament that as of March 2024, there are Rs 8,505.23 crore held in inoperative accounts, a significant increase from the Rs 1,638.37 crore recorded in the fiscal year 2018-19. The number of inoperative accounts has also risen from 6.91 lakh in 2018-19 to 21.55 lakh in the current year. The number of inoperative employees' provident fund (EPF) has grown more than 200 per cent in the last six years to 21,55,387 inoperative EPF accounts in financial years 2023-24. 

Inoperative accounts refer to cases where contributions have ceased for a period of time, often due to employees neglecting to transfer or claim their funds upon changing jobs or retiring.

What is an inoperative EPF account?

An EPF account is deemed inoperative once the member reaches the age of 58 or if no transactions have occurred within a span of three years. This could be due to various circumstances such as leaving a job without seeking another, self-employment, or starting a new venture. 

As stated on the EPFO website, an account is labeled as Inoperative when contributions have not been received for three years post-retirement, permanent migration abroad, or in the event of death. Fortunately, a member has the option to request the EPFO to reactivate the account and access the funds held in the inoperative account.

How to reactivate your EPF accounts?

To ensure smooth processing of your EPF account, it is important to link your UAN with the inoperative account. If the UAN is not yet created, the EPF account is considered non-KYC compliant. In this scenario, you can generate a UAN by visiting the field office in person and submitting your application there.

For cases related to old age or disability, you have the option to submit your request online through the EPFiGMS portal. A representative from EPFO will then visit you to conduct a biometric verification and generate the UAN.

If UAN is not linked

If your UAN already exists but is not linked with your account and KYC details are not seeded, you can request the linkage by visiting the field office or submitting an online request for cases eligible for processing, such as old age and disability cases. Once the linkage is completed, it is important to ensure that your previous employer links your KYC details. Alternatively, the field officers can assist in seeding your KYC information.

Once the KYC seeding is completed, you can request to unblock your account and proceed with claiming your funds. 

Managing inactive EPF accounts

Accounts Inactive for Less Than Three Years: If an EPF account has been inactive for less than three years but is linked to a UAN, members can submit an online request to unblock the account. Once the request is approved, a refund claim can be initiated.

Accounts Inactive for More Than Three Years: In the case of EPF accounts linked to UAN that have been inactive for more than three years, members can submit an offline request at the field office as well as online to unblock the account. Upon approval, the member can proceed with the refund claim request.

For accounts of deceased members with unsettled funds, the nominees must file a refund claim. In such instances, EPFO is required to generate a UAN, seed KYC, and obtain the biometric details of the nominee/s before processing any refund claims.