Starting January 2025, EPFO subscribers will be able to withdraw their provident fund (PF) savings directly from ATMs. This is likely to make the process faster and more convenient. The move is aimed at reducing human intervention in PF withdrawals and simplifying the process for claimants, beneficiaries, and insured individuals.
Labour Secretary Sumita Dawra said that the IT infrastructure at the Labour and Employment Ministry is in the process of upgrading so that service delivery is augmented. The new IT version 2.1, due to come in place sometime next year, will upgrade EPFO systems to parity with banking systems, rendering PF withdrawal smoother and faster.
How Would the ATM PF Withdrawal System Operate?
An improved system will introduce a unique PF withdrawal card, exactly like a bank ATM card. The card will make access to the PF balance of a user possible, and its withdrawal will be subject to a limit of only 50% of the entire amount. Labour Secretary Dawra maintained that the overhaul will avoid the unnecessary procedures that lead to delaying the settlement of the claim.
Faster Claim Settlement with Simplified Procedures
Part of the IT improvement is that PF claim processing has already been made less cumbersome by eliminating redundant steps. This will reduce the delays in accessing funds for subscribers further.
Focus on Social Security for All Workers
The government is also pushing to extend social security benefits to gig and platform workers through the Code on Social Security, 2020. Though timelines for its implementation are still unclear, the government has reportedly finalized the work.
Present EPFO Withdrawal Rules
At present, there are more than 70 million active contributors in EPFO. EPFO rules do not allow the withdrawal of PF during employment. If a person is unemployed for one month, he/she can withdraw 75% of the PF balance. On two months of unemployment, the entire balance is allowed to be withdrawn.
The move is part of a bigger attempt at making life easy for Indians and ensuring that people living in the country will receive social welfare for this gargantuan workforce. As for the 64-crore economically active Indian populace, PF withdrawal with technology-driven reform is poised to get faster and more accessible and thereby make workers across the country feel easier about doing things.
