Universal provident fund scheme: How PF for gig workers, self-employed could work
The Indian government is developing a Universal Provident Fund scheme to provide retirement security for gig workers, the self-employed, and those in the unorganised sector. The proposed framework would allow these workers to make flexible contributions that earn interest similar to the existing Employees' Provident Fund Organisation (EPFO) system.
Why it matters
This initiative aims to bridge the social security gap for millions of informal workers who currently lack formal retirement benefits.
A Universal Provident Fund Scheme that includes workers in the unorganised sector, gig workers and the self-employed is in the works with an aim to provide retirement security to the population. In what is being seen as a game-changing proposal, the Employees' Provident Fund Organisation (EPFO) is working on a framework that will enable extending social security coverage and benefits to millions of workers who are currently outside the ambit of the EPF coverage.The proposed framework aims to allow unorganised sector workers and self-employed to set aside a portion of their income for deposits under a universal provident fund scheme which will earn regular interest on par with the existing EPFO scheme.At present, one of the main retirement savings options that is available to individuals - including government employees - is the National Pension System (NPS).
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