EPFO Members Alert: New Auto Process for Advance Withdrawal Limit
Labour Minister Mansukh Mandaviya announced a significant enhancement to the Employees’ Provident Fund Organisation (EPFO) auto-settlement system on Tuesday. The threshold for advance withdrawals has been raised from Rs 1 lakh to Rs 5 lakh, allowing members to access their funds more swiftly. This change aims to facilitate quicker financial support for EPFO subscribers, especially during emergencies, with claims processed automatically within three days.
Enhanced Auto-Settlement for EPFO Members
The recent announcement by the Labour Minister marks a pivotal shift in the EPFO’s approach to advance withdrawals. Previously, the auto-settlement system was limited to claims of up to Rs 1 lakh. With the new limit set at Rs 5 lakh, members can now expect faster access to their funds. This improvement is particularly beneficial for those facing urgent financial needs. The minister emphasized that this upgrade would positively affect hundreds of thousands of subscribers, enhancing their ability to manage unexpected expenses.
The EPFO, which serves over 7 crore members, initially introduced the online auto-settlement facility in response to the financial challenges posed by the COVID-19 pandemic. The system was designed to provide rapid assistance to those in need. Currently, the auto-settlement covers various advance claims, including those for medical emergencies, educational expenses, weddings, and housing needs. The automated process ensures that claims are handled efficiently without manual intervention, resulting in quick and straightforward outcomes.
In the fiscal year 2024-25, the EPFO achieved a remarkable milestone by processing 2.34 crore advance claims through this automated system. This represents a staggering 161 percent increase from the previous year’s 89.52 lakh claims. The minister noted that automated settlements accounted for 59 percent of total advance claims in FY25, a significant rise from 31 percent in FY24.
Future Access to EPF Funds via ATMs and UPI
In addition to the auto-settlement enhancements, EPFO members may soon have the option to access their EPF funds directly through ATMs or Unified Payments Interface (UPI). A senior official from the labour ministry revealed that a new system is being developed to allow members to withdraw a portion of their EPF funds while keeping a significant amount locked. This would enable easier access to funds via bank accounts using UPI or ATM debit cards.
Currently, EPFO subscribers must submit withdrawal applications to access their funds, which can be a lengthy and cumbersome process. The upcoming changes aim to streamline this experience, making it more user-friendly and efficient. The ministry is actively addressing technical software issues to facilitate the implementation of this new system, which promises to enhance the overall experience for EPFO members.
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