The Employees’ Provident Fund Organisation (EPFO) has extended the period for final settlement or full withdrawal of funds from provident fund and pension accounts for unemployed members. Under the revised rules, members can now withdraw their provident fund after 12 months of unemployment and their pension after 36 months, PTI reported.The change was approved by the apex decision-making body of the EPFO, the Central Board of Trustees, chaired by Labour Minister Mansukh Mandaviya, during a meeting held on Monday. Earlier, the scheme allowed full withdrawals from both accounts after just two months of continuous unemployment.A senior official explained PTI that the move aims to ensure social security for formal sector workers who typically exit the EPFO after two months of unemployment. “Most of these unemployed youth need to enrol again when they secure new jobs and lose chances of earning pension and other benefits, as an account becomes pensionable only after a combined service of 10 years or more,” the official said.The ministry said the revision will also allow partial withdrawals, enabling members to meet immediate financial needs without affecting their retirement savings or pension entitlements.
Additionally, a provision has been introduced to maintain a minimum balance of 25 per cent of contributions in members’ accounts at all times.“This will enable members to enjoy the high interest rate currently offered by the EPFO, 8.25 per cent per annum, along with compounding benefits to build a sizeable retirement corpus,” the statement added.The rationalisation is intended to improve ease of access while ensuring members maintain a sufficient retirement fund over the long term. |
