The Employees' Provident Fund Organisation (EPFO) has announced significant changes to its withdrawal rules, making it much easier for millions of salaried individuals to access their provident fund savings. This major decision was taken during a Central Board of Trustees (CBT) meeting chaired by Union Labour Minister Mansukh Mandaviya.
Simplified Withdrawal Categories
In a move to streamline the process, EPFO has replaced 13 complex existing rules with just three simplified categories for partial withdrawals. These new categories cover essential needs such as illness, education, marriage, housing-related expenses, and special circumstances. This simplification aims to make the withdrawal process more transparent and user-friendly, while
Enhanced Limits for Education and Marriage
Previously, members were allowed only three withdrawals for education and marriage purposes. This limit has now been Notably increased to 10 withdrawals for education and 5 withdrawals for marriage. Also, the minimum service period required for withdrawals has been reduced to 12 months, which was previously varied for different needs.
Withdrawal Without Stating Reasons in Special Cases
Under the old rules, members often had to provide specific reasons for withdrawals during special circumstances like natural disasters, unemployment, or pandemics, which sometimes led to claim rejections, while the new rules eliminate this hurdle, allowing members to withdraw funds in special situations without needing to state a specific reason.
Minimum Balance and Auto-Settlement
EPFO has also ensured that a minimum balance. Of 25% of the total amount remains in the member's account. This ensures that members continue to benefit from the 8. 25% interest rate and compound interest, helping them build a substantial retirement corpus. The new system also aims for fully automatic processing of withdrawals,. Eliminating the need for document submission and ensuring faster claim settlements. The period for premature final settlement has been extended from 2 months to 12 months, and for pension withdrawal from 2 months to 36 months.
