EPFO Allows Full Provident Fund Withdrawal Under New Policy

In a major policy update ahead of Diwali, the Employees’ Provident Fund Organisation (EPFO) has announced that members can now withdraw up to 100 percent of their eligible balance from their provident fund (PF) accounts.
The decision was approved during the 238th meeting of the Central Board of Trustees (CBT) held in New Delhi, chaired by Union Labour and Employment Minister Mansukh Mandaviya.
The reform marks a significant change in India’s retirement savings framework. Previously, full PF withdrawal was allowed only upon retirement or after prolonged unemployment. Under the old rules, members could access 75 per cent of their balance after one month of unemployment and the remaining 25 per cent after two months. The new regulation now allows complete withdrawal, providing greater financial flexibility during key life stages.
For housing-related purposes—including property purchase, home construction, or repayment of EMIs—the withdrawal limit has been raised from 90 per cent to 100 per cent.
To simplify the withdrawal structure, the EPFO has consolidated 13 existing provisions into three main categories:

Essential needs (such as illness, education, and marriage)

Housing needs

Special circumstances

Withdrawal limits have also been liberalised. Members may now make up to 10 withdrawals for education and five for marriage, compared to the earlier combined limit of three. The minimum service period required for partial withdrawals has been standardised at 12 months.
A zero-documentation process has also been launched to automate partial withdrawal claims, aiming to ensure faster settlements. However, to maintain long-term financial discipline, members are required to keep at least 25 per cent of their contributions in their PF accounts to continue earning the annual 8.25 per cent interest.
In addition, the CBT has extended the timeline for premature settlements—allowing final withdrawals after 12 months instead of two—and increased the pension withdrawal period from two months to 36 months.
These measures are expected to make provident fund access more flexible, transparent, and responsive to the financial needs of India’s salaried workforce.
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