Dr. Mansukh Mandaviya Approves Centralized Pension Payment System for EPFO

In the next phase, the CPPS will facilitate a smooth transition to an Aadhaar-based payment system (ABPS), further enhancing the efficiency and security of pension disbursements.

In a landmark decision, the Union Minister of Labour and Employment and Chairperson of the Central Board of Trustees, EPF, Dr. Mansukh Mandaviya, has approved the proposal for a Centralized Pension Payment System (CPPS) under the Employees’ Pension Scheme, 1995. This initiative marks a significant shift in the pension disbursement process, establishing a national-level centralized system that enables pensioners to receive their pensions through any bank, at any branch, across India.

Commenting on this transformative decision, Dr. Mandaviya stated, “The approval of the Centralized Pension Payment System (CPPS) is a major milestone in the modernization of the Employees' Provident Fund Organization (EPFO). By allowing pensioners to receive their pensions from any bank, any branch, anywhere in the country, this initiative addresses the long-standing challenges faced by pensioners and ensures a seamless and efficient disbursement mechanism. This is a crucial step in our ongoing efforts to transform the EPFO into a more robust, responsive, and tech-enabled organization, committed to serving the needs of its members and pensioners better.”

The CPPS is expected to benefit over 78 lakh EPS pensioners under the EPFO by leveraging advanced IT and banking technologies to offer a more efficient, seamless, and user-friendly experience. One of the key advantages of the new system is that it eliminates the need for transferring Pension Payment Orders (PPO) when a pensioner relocates or changes their bank or branch, providing much-needed relief, especially for those who move to their hometowns after retirement.

Scheduled to be launched on January 1, 2025, as part of the EPFO’s ongoing IT modernization project, Centralized IT Enabled System (CITES 2.01), the CPPS represents a paradigm shift from the current decentralized pension disbursement system. The existing system relies on each Zonal/Regional Office of the EPFO maintaining separate agreements with only a few banks, often leading to inefficiencies and delays.

With the implementation of CPPS, pensioners will no longer need to visit bank branches for verification at the start of their pension. Instead, pensions will be credited immediately upon release, simplifying the process and enhancing convenience. Additionally, the EPFO anticipates a significant reduction in pension disbursement costs with the new system.

In the next phase, the CPPS will facilitate a smooth transition to an Aadhaar-based payment system (ABPS), further enhancing the efficiency and security of pension disbursements. This initiative is a critical component of the government's broader vision to modernize and digitize public services, ensuring that they are more accessible and responsive to the needs of citizens.