#Covid19: Govt Will Pay Your Provident Fund For 3 Months; 75% Of EPF Balance Can Be Withdrawn (Full Details Here)
Serving as a huge relief for salaried individuals, the government has made a few big announcements regarding the EPF (Employees’ Provident Fund). The economy has sinked drastically, and these decisions have been taken to make it easier for the 4.8 crore employees in India.
What are the announcements? How will this affect the salaried employees? Find out all the details right here!
Government To Pay EPF Contributions; Big Relief For Salaried Employees
The Finance Minister Nirmala Sitharaman announced in a press conference that several steps have been taken to offer relief to the salaried employees. As per the new changes, the government will be paying the employees’ contribution of 12 per cent plus 12 per cent of the employer’s contribution in the employees’ provident fund. They will be paying this for 3 months.
Depending on the basic salary of the employee, 12 percent is equally contributed by the employer and the employee as well. The interest rate is paid on such monthly running balance that keeps accumulating in the PF accounts of employees’.
There are many experts who have welcomed the move. Saraswathi Kasturirangan, partner at Deloitte India said that as of now, the non-refundable advances are permitted for specified purposes only, such as housing, marriage, etc. However, these are offered only when the employee has served a minimum period of service.
She said, “The proposal to permit non-refundable advance to employees out of their PF balances will help employees to tide over their liquidity issues.The FM’s proposal will enable employees to withdraw up to 75 per cent of the PF balances limited to 3 months wages as non-refundable advance enhancing the liquidity of employees.”
Employees Need To Meet This Eligibility Criteria To Avail This Facility
However, there is a possibility that the relief package will not be available for all employees and is limited for a few eligible employees only.
This benefit will be applicable to all the establishments which have only up to 100 employees. Of these, 90% are earning less than Rs. 15000 per month. If you belong to such an establishment, you will be eligible for this benefit.
Additionally, 8.33 per cent of the employer’s contribution will go into the employees’ pension scheme every month.
Other than that, the government has also announced that the EPFO scheme regulations will also be amended. This will allow non-refundable advance will is 75% of credit balance i.e., the PF balance or 3 months of wages. This will benefit 80 lakh employees of as much as 4 lakh establishments.