EPF Withdrawal Rules Changing: What You Must Know

Big news for Employees’ Provident Fund (EPF) account holders! The government is planning to relax the current stringent rules on withdrawals from your EPF account. Right now, you can only access the full balance of your EPF when you leave your job or retire, but that may soon change.

According to reports, the government wants to allow employees to access some or all of their EPF savings every 10 years, regardless if they are still working. This means you could access some of your EPF savings without having to wait for retirement or losing your job.

At the moment, you can only withdraw your EPF balance in full after retirement or if, you are unemployed for over two months. Only partial withdrawal is allowed in cases for a specific purpose for either buying a home, medical contingencies, educational matters, or marriage.

The new regulations will permit members to withdraw as much as 60% of their total balance in EPF every decade, starting from the age of 30. This allowed access to a large portion of retirement savings allows employees more flexibility in utilizing their savings when needed or when they have more concerns at their current employment situation.

EPFO manages over 7.4 crore members offering a humongous fund of approximately ₹25 lakh crore. The Government is looking into ways to allow access to funds while still considering the need for employees to invest for their future.

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Additionally, members may also withdraw up to 90% of their EPF savings to purchase land and/or make a house from this month. Before, members had to save five years before they could make an advance and use the EPF. Now the period has been reduced to three years. The amount withdrawable for advance claims without needing additional approval has also increased from ₹1 lakh to ₹5 lakh allowing members to get expedient money in situations of urgency.

The goal of these amendments is to allow EPF members to get access to their money when they choose to and not only at retirement, especially in life event situations.