The Employees Provident Fund Organisation (EPFO) in an unprecedented decision, has increased the statutory minimum pension under (EPS-95) scheme to 7500Rs. monthly. This much anticipated reform considers the inflationary pressure and will provide financial dignity to more than 78 lakh pensioners all over India. This increase becomes effective April 2025 and also comprises a new Dearness Allowance (DA) component in the relief2.
Minimum Pension Raised to ₹7,500
The low pension was then 1000 Rupees which was criticized as being insufficient in the contemporary economy. Now that they will receive the revised 7,500 payout, retirees are now capable of maintaining vital expenses, such as food, healthcare and residential costs. This figure is seven times more than it was 20143 indicating a significant revision.
Dearness Allowance Now Included
Ostensibly, EPFO pensions will now be capable of including DA pegged to All India Consumer Price Index (AICPI) as the first time ever. This makes sure that the pensioners have purchasing power by protecting the income when adjusted to inflation. The DA rate stands at the moment at 7%, periodic correction is anticipated.
Automatic Implementation for Eligible Pensioners
The automatic revision of pension to all retirees under EPS-95 who have had 10 years contributory service will take place. There will be no need to reapply and payments will be continued to be added to bank accounts linked to Aadhaar. To prevent the delay, pensioners are encouraged to renew their KYC6.
Effect on Retirees and Families
The increase in pension lowers reliance on family as well as increases financial freedom among the elderly. It provides an increase in the consumer spending in other sectors such as the healthcare and the retail amid the overall economic growth. To a lot of them, this transition signifies the move ahead in the direction of stability.
EPFO Pension Structure Comparison
Here’s a breakdown of how the new pension structure compares with the previous one:
| Pension Category | Previous Amount | Revised Amount | DA Rate | Total Monthly Pension |
|---|---|---|---|---|
| Minimum Pension | ₹1,000 | ₹7,500 | 7% | ₹8,025 |
| Small Factory Workers | ₹1,500 | ₹7,500 | 7% | ₹8,025 |
| Junior-Level Retired Staff | ₹2,000 | ₹7,500 | 7% | ₹8,025 |
| Mid-Tier Private Employees | ₹6,000 | ₹7,500 | 7% | ₹8,025 |
| Skilled Retirees | ₹7,500 | ₹7,500 | 7% | ₹8,025 |
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