"About 1,500 companies have been granted exemption (ie: permission) to maintain their own EPF trusts. While the declaration of the minimum interest prescribed by the EPFO and meeting of any deficit by the employer company, are conditions prescribed for running a private EPF trust, some were not following it. The recent circular on interest rate and prompt communication to employees aims to ensure parity for employees covered by such private trusts," TOI quoted an official as saying.
Government sources added that stringent action, such as cancellation of the permission given to the private EPF trust, will be taken for repeated defaults, especially for delays in remittance of money collected from employees or for reduced interest rates.
All the companies employing 20 or more individuals have to provide provident fund for social security. In case a company does not opt for its own private provident fund trust, the employees are directly covered by the fund administered by the EPFO. EPFO communicates remittances made to the accounts of employees via UMANG mobile app e-passbook.