EPFO: The Central Board of Trustees (CBT) of the Employees’ Provident Fund Organisation (EPFO) took several historic and member-friendly decisions in its meeting on Monday. Chaired by Labour Minister Mansukh Mandaviya, the meeting included several key decisions, including easing EPF partial withdrawal rules, the launch of the ‘Vishwas Scheme’, and digital transformation (EPFO 3.0). These decisions are expected to benefit over 7 crore EPFO account holders.
The EPFO Board has simplified and liberalized the provisions for partial withdrawal from the Provident Fund (EPF). Members will now be able to withdraw up to 100% of the balance in their account (both employee and employer contributions). Earlier, there were 13 different and complex provisions for partial withdrawal, which have now been integrated into three main categories – 1. Essential needs: illness, education, marriage, etc., 2. Housing needs, and 3. Special circumstances. This means that EPFO members will no longer be required to provide any reason for withdrawal under special circumstances (such as natural calamities, lockdowns, epidemics, etc.).
Withdrawal limits for education and marriage have been increased to 10 times and 5 times, respectively. The minimum service period for all types of partial withdrawals has now been reduced to just 12 months. Not only that, The EPFO has added a new provision requiring members to maintain a minimum balance of 25% of their total contributions in their accounts. This is intended to ensure that members can accumulate a sufficient amount for retirement while enjoying the benefits of high interest rates (currently 8.25%) and compounding.
Under the new rules, the partial withdrawal process will be fully automated. Members will no longer be required to submit any documents, and claims will be processed faster online. Furthermore, the final settlement period has been changed: