Govt set to increase auto-settlement limit for PF withdrawals From Rs 1 Lakh to Rs 5 lakh
EPFO members would be able to withdraw up to Rs 5 lakh under automatic processing, without manual involvement, once the new amount is approved.
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In a significant boost to make easier access for employees' savings, the central government is set to raise the automatic settlement limit for provident fund (PF) withdrawals from Rs 1 lakh to Rs 5 lakh. The Employees’ Provident Fund Organisation (EPFO) has decided to enhance the limit for automatic claim settlements to improve the ease of living for its 7.5 crore members.
During an EPFO executive committee meeting last week in Srinagar, Labour and Employment Secretary Sumita Dawra authorised the plan. The idea now waits for final approval by the central board of trustees (CBT).
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EPFO members would be able to withdraw up to Rs 5 lakh under automatic processing, without manual involvement, once the new amount is approved. The auto-settlement mechanism, which was first deployed in April 2020 for medical situations, had its ceiling raised from Rs 50,000 to Rs 1 lakh in May 2024. The complex has now been expanded to withdrawals for housing, marriage, and education.
Currently, as a significant improvement from the earlier 10-day timeline, 95 percent of PF claims are processed automatically within three days.
Read Also : Coal India Ltd increases coal price by Rs 10 per ton, effective from 16 AprilThe number of claim validation processes has been cut from 27 to 18; it is intended to go down to six. Claims' rejection rate has fallen from 50% last year to 30%.
Also, EPFO is trying to let members take their PF out via UPI and ATMs by May or June 2025. This function might eventually be applied to additional programs, including public provident fund (PPF) and general provident fund (GPF). These changes are included in EPFO's larger campaign to streamline the PF withdrawal procedure, hence guaranteeing quicker access to money with less documentation.
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