Soon you will be able to withdraw money from your Provident Fund (PF) account through ATM. The government is going to make such arrangements from this month i.e. January itself. Labor Ministry Secretary Sumita Dawra has made such an announcement recently. He said that such a scheme has been designed to ease access to PF accounts for crores of members.
Speaking to news agency ANI, Dawra said, ‘We are settling claims rapidly and working to simplify the processes so that people’s lives become easier. “Such arrangements are being made so that claimants, beneficiaries or insured persons can easily access their funds through ATMs with minimum human intervention.”
Dawra said, ‘The system is continuously improving. After every two-three months you will see a lot of improvement. ,
Under the new system, a special PF card will be issued to withdraw money from the PF account. This card will work like a normal bank ATM card. To ensure availability of funds in emergency situations, a limit of 50 percent of withdrawal from PF account will be set.
1. PF withdrawal cards will be linked to customers’ accounts
2. Money can be withdrawn directly from any ATM
3. Only 50 percent of the amount can be withdrawn from the PF account.
Dawra said the IT system is being upgraded to process PF claims. He said, ‘Unnecessary processes are being removed in order to streamline the IT system.’
According to Adil Shetty, CEO of Bankbazaar.com, the system of withdrawing money from PF account through ATM is a good news for EPFO customers. He told what will be the benefit of this:
1. Easy access: Subscribers will no longer need to visit EPFO offices or go through lengthy procedures. They will be able to easily withdraw their money from any ATM.
2. Faster Transactions: The facility to withdraw money from ATM will eliminate the delay in transactions due to the old process of PF claim processing. With this, money can be available quickly for emergency needs.
3. Always Available: Subscribers can withdraw money from their PF funds at any time due to 24×7 availability of ATMs. Service will not be interrupted even during weekends or holidays.
4. Efficiency: Upgradation of IT systems will bring ease in transactions. This will reduce the chances of mistakes as well as make the process more reliable.
5. Financial security: Immediate access to PF account funds improves financial strength. This is especially helpful in situations like a medical emergency or sudden expenditure.
While working, employees can withdraw up to 90 per cent of the amount from their PF account on the EPFO portal for specific purposes, which generally depends on the reason for withdrawal and years of service. You can withdraw money from PF account under the following circumstances:
1. Housing related needs: After completing at least 5 years of service, up to 90 percent of the amount can be withdrawn from the PF account to buy or construct a house.
2. Medical emergencies: For medical emergencies, an amount equal to 6 months’ basic salary and dearness allowance or the employee’s share with interest, whichever is less, can be withdrawn.
3. Education or marriage: After completion of 7 years of service, up to 50 percent of the employee’s share along with interest can be withdrawn for the needs of education or marriage.
4. Retirement: If your age is more than 54 years, you can withdraw up to 90 percent of the amount from your PF account one year before your retirement date.
The purpose of all these withdrawal options is to provide financial assistance in special circumstances of the subscriber’s life. But it is ensured that the savings remain intact for long-term needs.
The government is taking steps to improve social security for all workers, including gig workers and platform sector workers. The Social Security Code, 2020 plans to provide benefits such as medical coverage, disability assistance and provident fund to gig workers.
Apart from this, many other measures have also been taken which are as follows:
1. Plan to raise salary limit for EPF eligibility to Rs 21,000
2. Consideration of removing the 12 percent limit on voluntary PF contribution.
3. Streamlining claims settlement to speed up processing
However, the government has not disclosed any timeline for implementing the new system of social security benefits. But Dawra said that efforts are being made for this. The number of active members of EPFO is currently more than 7 crore. The organization is focusing on modernizing its services to make life seamless for the subscribers.