Prime Highlights:
- EPFO will permit PF withdrawals through UPI and ATMs between May or June 2025 with instant availability up to ₹1 lakh.
- The decision will improve the transaction speed, cut down on inefficiencies, and offer flexibility in withdrawing the funds.
Key Background:
Employees’ Provident Fund Organisation (EPFO) will soon introduce a new facility wherein the members will be allowed to withdraw their provident fund (PF) through the Unified Payments Interface (UPI) and Automated Teller Machines (ATMs). The facility, to be introduced in May or June 2025, would have immediate withdrawal up to ₹1 lakh, which would make it easy for the account holders to withdraw.
Today, PF withdrawal involves online submission of claims and waiting, until two or three days in all cases for crediting the fund. With inclusion of UPI and ATMs, members can enjoy nearly real-time transactions without waiting time and convenience of withdrawal. This is a step in the direction of a big leap in digitalization in the EPFO, which is part of the larger dream of financial inclusion and technology proliferation in India.
To make its operations effective, EPFO has already made its processes streamlined by consolidating more than 120 databases, and the processing time of claims is now just three days. Further, 95% of the claims are also processed automatically. Implementation of UPI and ATM withdrawals would also make the process faster and give the fund to the workers in a faster manner.
Apart from speeding up withdrawals, EPFO is also increasing the scope of allowable fund utilization. Members will be permitted to withdraw PF for housing, education, marriage, and medical expenses. This freedom will enable employees to exercise more control over their financial requirements.
Labour and Employment Ministry issued a green light for incorporating UPI in the withdrawal mechanism of EPFO, as suggested by the National Payments Corporation of India (NPCI). From then on, members of EPFO will be able to check their PF balance through UPI platforms, instantaneously withdraw, and transfer funds to their chosen bank accounts without waiting.
With the adoption of electronic payment systems, EPFO is going in the right direction to increase user convenience, financial inclusion, and overall efficiency to the point where the members would be free to use their savings at their own will.
