Understanding The Importance Of UAN Activation
New Delhi : EPF is a pension investment scheme and is a much more effective and mandatory plan as per the government regulations. Such great returns are not usually seen in government schemes, let alone conventional investment schemes. The 8.1% EPF interest rate is in itself a battle cry for its high returns. You won’t see such high annual returns in any fixed capital investment, even in fixed deposits, the staple investment plan for Indians. But to enjoy the benefits of EPF, you must first have a UAN. And for that, you must complete the process of UAN activation. Here, you will know everything about UAN, UAN activation, and its importance.
UAN And How It Works
UAN or Universal Account Number is an identification number provided by the EPF managing organization EPFO. EPFO gives such a unique UAN to every EPF account holder. The major feature of UAN is that it allows branching of all your EPF past, present and future EPF accounts. Every employer will give you different EPF accounts when you first join them, and the EPF contributions deposit into these accounts. But separately managing all these EPF accounts can be tough for you and EPFO. So as a solution to the complexity, they decided to merge all the EPF accounts of an employee under a single UAN.
The first time you join an EPF eligible establishment and when you have an EPF eligible salary scale, the employer generate UAN on your behalf. Some employers might differ or avoid UAN and EPF, but you can still sign up voluntarily and generate UAN. However, after the UAN generation, you also need to go through UAN Activation mandatorily.
UAN Activation For EPF Account Holders
UAN activation is the sole responsibility of the EPF account holder. So they have to carry out the process on their own through the official EPFO website. This is to ensure the correctness of the details provided by the employer during the UAN generation. Given below are the step-by-step procedures for UAN activation.
• Visit the EPFO Employees Portal
• Click on Activate UAN given below the login section
• It will lead you to UAN Activation Page
• You can toggle between UAN or Member Id based on which detail the employer provided
• Enter the UAN or Member Id
• Enter Aadhaar Number
• Enter Name
• Enter Date of Birth
• Enter Mobile Number
• Enter the Captcha code from the image
• Tick the box which asks for Aadhaar based authentication through OTP
• Click on Get Authorization Pin
• Enter the OTP that you will get on the mobile number submitted
• Click on Validate OTP
• Click on Activate UAN
And this concludes the UAN activation process
Importance Of UAN Activation And Linking Multiple EPFs
UAN activation process might seem unnecessary, especially when the employer generates it using the employee’s documents. Above all, the activation provides you with the benefit of linking multiple EPFs, which has several other benefits. Below are the direct benefits you get for activating UAN and linking multiple EPF accounts.
One-stop destination for all EPF accounts
The major benefit that you get upon UAN activation is that you get access to UAN, which is a percussor to manage all your EPF accounts. First-time EPF account holders can link current and future employers within this UAN. And after that, they can manage all the EPFs in one place without the need for separate IDs and logins.
One-time process
Apart from being so easy, activating the UAN is also a one-time process. The EPFO only allows one UAN for one person, which is why they require the linking of UAN with important documents such as Aadhaar and PAN. So when you change jobs, you don’t have to activate a new UAN; you just need to provide the existing UAN to your new employer. And they will create an EPF account under that UAN, and you can see it in your existing EPFO account.
Full access to EPF benefits
Activating UAN also gives you full access to every feature on the EPFO website and the EPF accounts. Here, you can perform various actions, including withdrawing funds without the employer’s intervention.
Management and Calculation of Pension Fund
Through UAN, you can also manage and calculate the total funds accumulated in all your EPF accounts. This is of extreme assistance in taxation and procedures related to work track record.
Now that you know everything about the process of UAN activation and its importance, you will never defer the process due to its beneficial outcomes. UAN activation opens the door to EPF and the high EPF interest rate, which allows you to accumulate large funds. And these EPF contributions are only 10 or 12% of your basic pay and not even your entire salary so that you can invest in your future without much repercussions in your current lifestyle. With such small amounts, you won’t even notice the deductions but still, have a huge corpus when you retire or need money for some emergencies.
