EPFO now allows members to withdraw 100% of provident fund balance under liberalized norms

In a sweeping reform to improve flexibility and ease of access, the EPFO has approved simplified withdrawal rules, a litigation relief scheme, and a major digital transformation under EPFO 3.0.

In a landmark move for over seven crore subscribers, the Employees’ Provident Fund Organisation (EPFO) has rolled out a set of sweeping reforms to simplify access, improve transparency, and enhance digital efficiency. The decisions, taken at the Central Board of Trustees (CBT) meeting chaired by Labour Minister Mansukh Mandaviya, mark one of the most significant overhauls in EPFO’s history.

The headline reform, liberalised withdrawal rules, now allows members to withdraw up to 100% of their provident fund balance, including both employee and employer contributions. The earlier patchwork of 13 withdrawal provisions has been merged into three simplified categories:

Essential Needs (such as illness, education, marriage)
Housing Needs 
Special Circumstances

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The Labour Ministry clarified that education and marriage withdrawals have been liberalized,  members can now make up to 10 withdrawals for education and 5 for marriage, compared to the earlier combined cap of three. Additionally, the minimum service requirement for all withdrawals has been standardised at 12 months, ensuring broader access.

To prevent complete depletion of savings, the EPFO has added a safety net, 25% of each member’s corpus will remain untouched, continuing to earn interest at 8.25% per annum, ensuring long-term retirement security. The organisation also aims for 100% auto-settlement of claims without paperwork, cutting delays and human intervention.

Alongside, the CBT unveiled the Vishwas Scheme, designed to resolve 6,000-plus litigation cases involving ₹2,406 crore in penal damages. Under the scheme, penal interest rates are drastically reduced to 1% per month, with graded relief for short-term defaults. All pending cases will be considered settled upon compliance, bringing long-awaited relief to employers.

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In another crucial reform, the Board approved an MoU with India Post Payments Bank (IPPB) to deliver Digital Life Certificates (DLCs) to pensioners under EPS’95 at no cost. The ₹50 per certificate fee will be fully borne by EPFO, enabling doorstep verification for elderly pensioners, particularly those in rural areas.

Further modernising operations, EPFO 3.0 was launched, a member-centric digital ecosystem integrating cloud-native and API-first systems for faster claims, multilingual self-service, payroll-linked contributions, and seamless automation.

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The Board also appointed four fund managers, SBI Funds, HDFC AMC, Aditya Birla Sun Life AMC, and UTI AMC, to manage its debt portfolio for the next five years, ensuring balanced and prudent fund management.

Labour Minister Mandaviya described the reforms as “a step towards Ease of Living for India’s workforce,” reaffirming EPFO’s mission to combine financial security with digital empowerment.