Starting January 2025, Employees’ Provident Fund Organisation (EPFO) subscribers may gain the ability to withdraw their provident fund (PF) savings directly from ATMs. This revolutionary change is part of the Labour and Employment Ministry’s efforts to modernize PF withdrawals and streamline service delivery through advanced IT systems.
Labour Secretary Sumita Dawra confirmed the development, stating that the ministry is upgrading EPFO’s IT infrastructure to align with banking systems. “We are enhancing our IT system to simplify claim settlements. PF withdrawals through ATMs will soon be a reality,” Dawra told ANI.
How the System Will Work
The initiative will introduce a dedicated PF withdrawal card, functioning similarly to a bank ATM card. Withdrawals will be capped at 50% of the total PF balance to ensure long-term savings.
The IT 2.1 upgrade, expected to go live next year, will enable minimal human intervention in claim processing. Dawra noted that faster claim settlements have already been achieved by eliminating unnecessary procedures as part of this overhaul.
Focus on Social Security
The government has reiterated its commitment to improving social security measures for workers, including extending benefits to gig and platform workers under the Code on Social Security, 2020. While a timeline for these benefits hasn’t been disclosed, officials indicate that implementation efforts are in advanced stages.
Current EPFO Withdrawal Rules
With over 70 million active contributors, EPFO currently allows withdrawals only under specific conditions:
- Employees cannot withdraw PF while employed.
- If unemployed for one month, employees can withdraw up to 75% of their balance.
- After two months of unemployment, the full amount becomes accessible.
Broader Implications
The government’s tech-driven reform aims to enhance ease of living and improve social welfare for India’s vast workforce, which includes over 64 crore economically active individuals.