New Delhi: In a major reform aimed at enhancing member convenience and reducing litigation, the Employees’ Provident Fund Organisation (EPFO) on Monday approved liberalised withdrawal rules, digital upgrades, and key institutional decisions in its latest Central Board of Trustees (CBT) meeting chaired by Union Labour Minister Mansukh Mandaviya.

What are the new EPF withdrawal rules?

To simplify member access, the CBT merged 13 complex withdrawal provisions into three streamlined categories:

  • Essential needs: Illness, education, marriage
  • Housing needs
  • Special circumstances: Natural calamity, unemployment, epidemics etc.

EPF members will now be allowed to withdraw up to 100% of the eligible amount from their Provident Fund accounts, including both employee and employer contributions.

What are the changes in withdrawal limits and service requirements?

  • Education withdrawals: Now permitted up to 10 times
  • Marriage withdrawals: Allowed up to 5 times

(Earlier, only 3 total partial withdrawals were allowed for both purposes combined.)

  • The minimum service period for any type of partial withdrawal is now uniformly reduced to 12 months.

Do members still need to provide reasons for special withdrawals?

No. The EPFO has removed the requirement to cite specific reasons for withdrawals under “special circumstances”. This change is aimed at reducing rejection of claims and easing the grievance burden.

“Members can now apply without assigning any reasons under this category,” the Labour Ministry confirmed.

What is the new Minimum Balance Rule?

To preserve retirement savings and allow continued interest earnings, EPFO has mandated that members must maintain a minimum balance of 25% of total contributions in their account.

This ensures that members continue to benefit from the 8.25% interest rate and compounding benefits, safeguarding their retirement corpus even if they opt for partial withdrawals.

How has the withdrawal process been simplified?

The partial withdrawal process has been:

  • Fully automated
  • Requires no documentation
  • Allows for auto-settlement of eligible claims

In addition, the period for final settlement has been extended:

  • EPF withdrawal: From 2 months → 12 months
  • Pension withdrawal: From 2 months → 36 months

These changes are designed to enhance ease of living and ensure members can meet urgent
financial needs without affecting their long-term benefits.

What is the Vishwas Scheme and how does it help employers?

To reduce litigation, EPFO has launched the ‘Vishwas Scheme’, addressing one of the biggest pain points: penalties for delayed remittances.

As of May 2025, EPFO had:

  • ₹2,406 crore in outstanding penal damages
  • Over 6,000 court cases
  • 21,000 potential cases pending on its e-proceedings portal

Key provisions of the scheme:

  • Flat 1% monthly penalty on late payments
  • Graded penalties:
  1. 0.25% for delay up to 2 months
  2. 0.5% for delay up to 4 months
  • The scheme will remain operational for 6 months, extendable by another 6
  • Applies to:
  1. Ongoing litigation under Section 14B
  2. Finalised but unpaid orders
  3. Pre-adjudication cases (notices issued but orders pending)

“All cases shall stand abated in case of compliance under the Vishwas Scheme,” said the Labour Ministry.

How will EPFO’s tie-up with India Post help pensioners?

EPFO has signed an MoU with India Post Payments Bank (IPPB) to provide doorstep Digital Life Certificate (DLC) services for pensioners under EPS‑95.

  • Each DLC service will cost ₹50, fully borne by EPFO
  • Especially beneficial for elderly pensioners in rural and remote areas
  • Improves pension continuity, speeds up family pension processes and enhances accuracy in the Centralised Pension Payment System (CPPS)

What’s EPFO 3.0 and how will it modernise services?

Under the EPFO 3.0 initiative, the board approved a comprehensive digital transformation framework with:

  • A Core Banking Solution
  • Cloud-native, API-first, microservices-based architecture
  • Multilingual self-service options
  • Real-time claim settlement
  • Seamless payroll-linked contributions

This phased rollout will ensure secure, scalable and uninterrupted service to over 30 crore users, reaffirming EPFO’s commitment to transparency and tech-driven service delivery.

Who are the new fund managers for EPFO?

The Central Board also finalised the appointment of four fund managers to oversee EPFO’s debt investment portfolio for the next five years:

1.SBI Funds Management Ltd

2.HDFC AMC Ltd

3.Aditya Birla Sun Life AMC Ltd

4.UTI AMC Ltd

This decision was made based on recommendations from the Selection Committee and endorsed by the Investment Committee, including senior officers and external investment experts.

The ministry said the move is “a significant step towards prudent investment management and improved returns for EPFO members”.

PTI