EPFO Overhauls Withdrawal Rules for Easier Access and Long-term Savings
The Employees' Provident Fund Organisation (EPFO) has overhauled its withdrawal rules, making it easier for members to access their funds while ensuring long-term retirement benefits. Key changes include reduced waiting periods, simplified categories, and enhanced withdrawal limits for emergencies.
EPFO has streamlined its withdrawal process, reducing the number of categories from 13 to just one. This simplification aims to make it easier for members to understand and navigate the withdrawal process.
One significant change is the reduction in the waiting period for withdrawals. Previously, members had to wait between 5 to 7 years for marriage or house purchase withdrawals. Now, they only need to wait one year. Additionally, full eligible amounts can be withdrawn up to twice a year without questions asked in case of special circumstances or emergencies.
The minimum balance required to maintain has been increased to 25%. This measure is designed to encourage long-term savings and ensure a high rate of interest and compounding benefits for retirement. However, members can still withdraw funds after one year, provided they maintain this minimum balance.
Another notable change is the extension of the final pension withdrawal timeline. It has been increased from two months to 36 months. This gives members more time to plan their finances during retirement.
Moreover, families of deceased EPFO members will now receive pension benefits even if the member contributed for less than 10 years. This change ensures that more families are protected in case of unfortunate events.
The EPFO's new withdrawal rules balance the need for members to access their funds with the importance of long-term retirement savings. The changes, including reduced waiting periods, simplified processes, and enhanced withdrawal limits, aim to provide members with greater flexibility and security.
