EPFO Introduces Centralized Pension Payment System for Seamless Disbursement

The Labour Ministry has approved a Centralized Pension Payment System (CPPS) under the Employees' Pension Scheme 1995, enabling pension disbursement from any bank or branch across India. The initiative, to be launched on January 1, 2025, aims to provide a more efficient and seamless pension distribution mechanism for over 78 lakh pensioners.

Pensioners under the Employees' Pension Scheme 1995, managed by the EPFO, will be able to receive their pensions from any bank or branch nationwide starting January, Labour Minister Mansukh Mandaviya announced on Wednesday.

Mandaviya, also the chairperson of EPFO's Central Board of Trustees, has greenlit the Centralized Pension Payment System (CPPS) for the Employees' Pension Scheme, according to a labour ministry statement.

The CPPS represents a significant shift towards a national-level centralized system, facilitating pension disbursements through any bank or branch throughout India.

"The approval of CPPS is a major milestone in modernizing the EPFO. This initiative addresses long-standing challenges and ensures an efficient pension disbursement mechanism for pensioners across the nation," said Mandaviya.

Highlighting the technological advancements, Mandaviya added, "This step is crucial in our ongoing efforts to transform EPFO into a robust and tech-enabled organization."

The CPPS is set to benefit over 78 lakh EPS-95 pensioners by leveraging advanced IT and banking technologies for a seamless user experience.

The centralized system will eliminate the need for transferring Pension Payment Orders (PPOs) across offices, alleviating the burden on pensioners relocating or changing banks/branches.

This initiative will be part of EPFO's IT modernisation project, CITES 2.01, launching January 1, 2025, with future plans to integrate an Aadhaar-based payment system (ABPS).

The new system diverges from the current process requiring zonal/regional offices to maintain agreements with a few banks. Now, pensioners will receive payments directly, without needing bank branch visits for verification.

EPFO anticipates significant cost savings in pension disbursement with this new system.

(With inputs from agencies.)