EPFO Rule Change: There’s some good news for EPFO members ahead of Diwali. A major decision was made at the 238th meeting of the Central Financial Institutions Committee (CBT) in New Delhi, allowing withdrawals of up to 100% of the PF balance, up to a minimum 25%.
EPFO Rule Change: The Employees’ Provident Fund Organization (EPFO) has made it easier to withdraw funds from PF accounts. In a significant announcement for its over 70 million members, the organization has clarified that they will now be able to withdraw the entire balance in their accounts without any hassle, except for the minimum balance. This new withdrawal limit has been approved by the Central Board of Trustees (CBT). The board has also taken several other important decisions to simplify the PF withdrawal process for EPFO members.
Withdrawal of 75% of PF deposits will be possible.
The meeting was chaired by Union Minister of Labor and Employment Mansukh Mandaviya. Union Minister of State for Labor and Employment Shobha Karandlaje, Secretary of the Ministry of Labor and Employment Vandana Gurnani, and EPFO Commissioner Ramesh Krishnamurthy were also present. The most significant decision made at the CBT meeting was that EPFO members will now be able to withdraw the entire eligible balance, including the employee and employer contributions, except for the minimum balance in their PF account. The minimum balance is 25% of the total funds deposited, allowing withdrawals of 75%.
Previously, this facility was available in these cases.
Previously, this limit was limited, allowing full withdrawals only in cases of unemployment or retirement. One month after becoming unemployed, a member could withdraw 75% of their PF account balance, and two months later, the remaining 25%. In the case of retirement, the entire amount was allowed to be withdrawn at once.
How is this decision beneficial?
Regarding this major decision taken at the CBT meeting, a statement issued by the Ministry of Labor stated that this relief has now been extended to all EPFO members. Members can now easily withdraw the remaining 75% of their PF account while maintaining a minimum balance of 25%. This will allow them to continue receiving the 8.25% annual interest rate provided by the EPFO. Maintaining the minimum balance will also help them maintain a retirement fund.
EPFO also made these changes
Regarding other decisions taken at this important meeting in New Delhi, withdrawals for education will be allowed up to 10 times, and for marriage, up to 5 times. Previously, the partial withdrawal limit was three, which has been removed to provide relief. The EPFO has also unified the service tenure limit for partial withdrawals, setting it at 12 months. This decision will be particularly beneficial for new employees.
100% Claim Settlement
Previously, in special circumstances, such as natural disasters or pandemics, a clear reason was required for withdrawing PF funds. Many claims were rejected in these cases. However, now, members under this category will not need to provide any reason. The ministry statement said that now the requirement of documents has been eliminated, which will ensure 100% automatic settlement of partial withdrawal claims and will provide convenience to the members.
