Centralized Pension Payments System (CPPS)

GS 2 – Governance

The Centralized Pension Payments System (CPPS), implemented by the Employees’ Provident Fund Organisation (EPFO), allows pensioners to access their pension from any bank or branch across India. This system is designed to streamline pension disbursement, eliminating the need for physical verifications and ensuring seamless payments for over 7.85 million pensioners.

Key Features of CPPS:

• Nationwide Accessibility: Pensioners can withdraw their pension from any bank, irrespective of the bank or branch they have an account with.
• Simplified Process: There is no need for physical verification when the pension commences, and pension amounts are credited immediately after release.
• Portability: Pensioners do not need to transfer pension payment orders (PPO) when they change locations or banks, ensuring uninterrupted pension payments.
• Shift from Decentralized to Centralized System: Unlike the previous decentralized system, where pension disbursement was managed through agreements with only a few banks per regional EPFO office, CPPS integrates the process nationwide.

Employees’ Provident Fund Organisation (EPFO)

The EPFO is a statutory body under the Employees’ Provident Funds and Miscellaneous Act, 1952, and functions under the administrative control of the Union Ministry of Labor and Employment.

Structure of EPFO:

• The EPFO is governed by the Central Board of Trustees, which consists of representatives from the Government (both central and state), employers, and employees.
• The board is chaired by the Union Minister of Labour and Employment.

EPFO’s Schemes:

1. Employees’ Provident Funds Scheme, 1952 (EPF)
2. Employees’ Pension Scheme, 1995 (EPS)
3. Employees’ Deposit Linked Insurance Scheme, 1976 (EDLI)

The EPFO also manages Bilateral Social Security Agreements with countries on a reciprocal basis, ensuring that both Indian and international workers benefit from social security schemes.

Coverage:

• EPFO’s schemes cover Indian workers and international workers from countries that have bilateral agreements with India.