The government has introduced a new set of rules under the Employees’ Provident Fund Organisation (EPFO) aimed at improving convenience for members. At the 238th Central Board of Trustees (CBT) meeting held in New Delhi, chaired by Union Labour Minister Mansukh Mandaviya, several reforms were approved to simplify partial fund withdrawals and enhance the ease of living for employees.
Simplified Rules for Partial Withdrawals
EPFO has now categorized withdrawals into three clear groups — Essential Needs (such as marriage, education, or illness), Housing Needs, and Special Circumstances.
Members will now be able to withdraw funds more frequently — up to 10 times for education and 5 times for marriage, compared to only 3 times earlier for both combined.
Additionally, the minimum service period required to become eligible for partial withdrawals has been reduced to 12 months, allowing members to access funds sooner without lengthy service prerequisites.
The Controversial Change: Longer Wait for Final Settlements
However, one new rule has sparked widespread concern among millions of EPFO members. The timeline for premature final settlement of EPF and pension funds has been extended significantly — from 2 months to 12 months for EPF, and from 2 months to 36 months for the Employees’ Pension Scheme (EPS).
This means that members can now withdraw their provident fund only after 12 months of unemployment, and pension funds only after 36 months. Previously, individuals could withdraw 75% of their PF after one month and the remaining 25% after two months of job loss — a provision that provided crucial financial relief during unemployment.
Public Reaction: Mixed Views on ‘Ease of Living’
Many members have taken to social media to express dissatisfaction, arguing that the rule could make life harder for jobless individuals who depend on PF savings to cover EMIs, education fees, or daily expenses. While the government’s intent appears to be safeguarding retirement savings, critics say the move could reduce financial flexibility when people need it most.
The Bottom Line
While the simplified withdrawal rules are a welcome step, the extended waiting period for final settlements may challenge the government’s promise of “ease of living.” Balancing long-term savings protection with short-term financial needs remains the key challenge for EPFO going forward.
