What exactly is Employees’ Provident Fund?
The Employees’ Provident Fund is run by a company through the same name by the Government asia. It’s a social security organization and gives pension advantages of the large number of organized workforce in the united states. Let’s start to see the great things about it.
In this scheme, 12 percent of the employee’s wages are deducted with the organization with an equal amount is contributed from the employer also. It is done in establishments that have got an employee strength of 20 or above. In cases like this, most of these organizations must fall under the jurisdiction from the scheme.
The existing interest is 9.5 percent around the deposits created by employees. The worker gets a pension on his retirement or there exists provision to the payment of the fixed figure to his family members on his untimely death.
Easy distribution of pension is one of the important things about this scheme. Under built, a staff must make a merchant account with one of the registered banks for payment of pension. After the retirement with the employee, pension is disbursed from the organization for the employee concerned. All banks with tie ups usually give a zero balance account on the pension holders. The pensioners usually get their pension prior to the tenth day of every month.
The challenge behind the scheme is its reach. It is hard to find all organizations having an employee strength of 20 or higher. The companies have to pay to sign up on the organization and also this subscription rate also prevents the organizations to join the scheme. Nevertheless the government is trying to help make the scheme a more attractive as well as simple. in general the scheme is a good tool for social security.