New Delhi: The Employees’ Provident Fund Organisation (EPFO) has approved sweeping reforms to simplify and liberalise withdrawal rules for its more than seven crore members, allowing withdrawals of up to 100 per cent of the eligible EPF balance.
At a meeting chaired by Labour Minister Mansukh Mandaviya, the Central Board of Trustees (CBT) — EPFO’s highest decision-making body — took several major decisions to improve ease of access and transparency for members, the Labour Ministry said on Monday.
Simplified and Liberalised Withdrawals
To make the process simpler, 13 existing complex withdrawal provisions have been merged into three streamlined categories —
Essential Needs (such as illness, education, and marriage)
Housing Needs, and
Special Circumstances.
Members can now withdraw up to 100 per cent of their eligible EPF balance, covering both employee and employer contributions.
The withdrawal limits have also been expanded — members can now make withdrawals for education up to 10 times and for marriage up to 5 times, compared to the earlier combined limit of three times for both purposes.
Additionally, the minimum service requirement for all partial withdrawals has been reduced to 12 months, ensuring quicker access to funds when needed.
Under the revised Special Circumstances category, members will no longer need to state specific reasons — such as natural calamities or unemployment — simplifying the claims process and reducing rejections.
Ensuring Retirement Security
To maintain a stable retirement corpus, members must now retain 25 per cent of their total contributions as a minimum balance. This will help them continue earning EPFO’s high interest rate of 8.25% with compounding benefits.
The changes will enable 100 per cent automated settlement of partial withdrawal claims, eliminating paperwork and delays.
Revised Settlement Timelines
The CBT also extended timelines for full settlements:
Premature EPF final settlement: from 2 months to 12 months
Final pension withdrawal: from 2 months to 36 months
These changes ensure flexibility for members while safeguarding long-term savings.
‘Vishwas Scheme’ to Cut Litigation
EPFO also introduced the ‘Vishwas Scheme’ to resolve long-pending litigations related to penal damages for delayed PF remittances. As of May 2025, over ₹2,400 crore in penal damages and more than 6,000 cases are pending across various courts.
Under the new scheme:
Penal damages are reduced to a flat 1% per month, with lower graded rates — 0.25% for up to two months’ delay and 0.50% for up to four months.
The scheme will be active for six months, extendable by another six.
It covers ongoing, finalised, and pre-adjudication cases under Section 14B.
All pending cases will be closed upon compliance.
Doorstep Digital Life Certificates for Pensioners
The Board also approved a partnership with India Post Payments Bank (IPPB) to offer doorstep Digital Life Certificate (DLC) services for EPS’95 pensioners.
Each certificate, costing ₹50, will be fully paid by EPFO, allowing pensioners — especially in rural areas — to submit life certificates from home through India Post’s network.
This will improve pension continuity, enable faster family pension processing, and enhance accuracy under the Centralised Pension Payment System (CPPS).
EPFO 3.0: Digital Transformation Drive
Under the EPFO 3.0 initiative, the CBT approved a comprehensive digital transformation framework integrating a core banking solution with cloud-based, API-driven systems for account management, compliance, and member services.
The new system will enable:
Instant claims and withdrawals
Multilingual self-service features
Seamless payroll-linked contributions
Real-time customer support
This transformation is designed to provide secure, scalable, and efficient service delivery to over 30 crore members.
Professional Fund Management
The Board also approved the selection of four Fund Managers to manage EPFO’s debt portfolio for the next five years. The move aims to strengthen portfolio diversification and maximise returns for members’ savings.
Digital Initiatives Launched
During the meeting, Labour Minister Mandaviya also inaugurated several new digital initiatives to boost transparency, efficiency, and user experience in EPFO’s operations.
