EPFO access is now getting easier. The organization has allowed its members to withdraw 100% of their PF balance, which includes both employee and employer contributions. This decision was made during the 238th meeting of the Central Board of Trustees (CBT) held in New Delhi. However, members must keep at least 25% of the amount in their EPF account at all times. Also, the employee must have completed at least one year of service.
Earlier, full PF withdrawal was allowed only in cases of unemployment or retirement. A member could withdraw 75% of the balance after one month of losing their job and the remaining 25% after two months. There was no restriction on full withdrawal at the time of retirement.
New EPFO Rules Make Withdrawals Easier
EPFO has made major changes to make withdrawals simpler and more flexible. Members can now withdraw up to 90% of their account balance for buying land, building a house, or paying a home loan. With the new decision, members can also withdraw their full PF amount if needed, following some updated rules.
Rules for Partial Withdrawal
To make the process easier, the board has combined 13 old conditions into three simple categories — essential needs, housing needs, and special circumstances. Essential needs include illness, education, and marriage.
Members can now withdraw up to 10 times for education and 5 times for marriage. Earlier, only three total withdrawals were allowed for both. The minimum service requirement for all types of partial withdrawals is now 12 months.
No Reason Needed for Special Circumstances
A big change has come under the “special circumstances” section. Earlier, members had to give reasons like natural disaster, unemployment, or factory closure, and many claims were rejected due to missing documents. Now, members can withdraw under this section without giving any reason.
Minimum Balance Rule
To protect retirement savings, EPFO has made it mandatory to keep 25% of the balance in the PF account at all times. This amount will continue to earn interest at 8.25% per year.
Paperless and Fast Claims
EPFO has also announced that all partial withdrawal claims will now be processed digitally, without any paperwork. This move is expected to make the process faster and more convenient for members.
Pension Withdrawal Period Extended
The waiting period for premature settlement applications has been increased from 2 months to 12 months. For final pension withdrawals, the period has been extended from 2 months to 36 months. These steps aim to balance short-term needs and long-term security.
Launch of Vishwas Scheme
The board also approved the launch of the Vishwas Scheme to reduce legal disputes, a doorstep digital life certificate service, and EPFO 3.0, which will modernize the entire system.
Overall, these changes will make the EPFO system simpler, faster, and more member-friendly while keeping retirement savings safe.