The Employees' Provident Fund Organisation (EPFO) is preparing a comprehensive framework to extend retirement savings and social security benefits to millions of self-employed individuals, gig workers, and unorganised sector employees.
The proposal marks a fundamental shift from the traditional EPF mandate, which historically limited coverage to salaried employees in establishments with 20 or more workers. The move is expected to benefit workers employed through app-based platforms, freelancers, daily wage earners, and self-employed professionals who are not covered under the existing EPF system.
Under a proposed universal provident fund (PF) scheme, individuals currently outside the formal social security net will be allowed to voluntarily contribute a portion of their income toward a long-term retirement fund. Individuals will be able to make contributions on a daily, monthly, or annual basis, according to their convenience.
The scheme will be based on the existing EPFO model, meaning deposits will earn annual interest and also qualify for tax benefits. EPFO is also considering introducing a Systematic Withdrawal Plan (SWP)-like option, allowing retirees to withdraw either a lump sum or fixed amounts at regular intervals based on their financial needs.
Unlike existing government welfare plans like the Pradhan Mantri Shram Yogi Maandhan Yojana where the Central Government matches the subscriber's pension contribution, the proposed universal PF model will operate as an entirely self-funded structure, requiring no direct budgetary support from the state.
While the Ministry of Labour and Employment has not yet issued a formal administrative mandate, the EPFO has proactively floated an independent tender to design and develop the advanced IT architecture required to support millions of decentralised accounts.
The push comes on the heels of the Code on Social Security, which empowers the government to establish comprehensive welfare, life insurance, and old-age protection frameworks for unorganised, gig, and digital platform workers. By utilising digital registries like the e-Shram portal to map the unorganised workforce, the proposed framework aims to seamlessly transition self-employed professionals and independent contractors into a structured, institutionalised retirement environment.
For working professionals outside traditional employment, the scheme could provide a long-term savings vehicle with the same interest and tax advantages currently available only to salaried employees, a gap that has left much of India's growing informal workforce without any structured retirement safety net.
