Waiting for weeks to withdraw your Provident Fund (PF) money will soon be a thing of the past, as the Employees’ Provident Fund Organisation (EPFO) has announced a revised system called EPFO 3.0 to improve employee welfare. According to the Labour Ministry, EPFO users will now be able to withdraw PF directly from an ATM using UPI, without any company or employer approval. Testing of this new system has been completed, and it may soon be implemented in phases.
What is EPFO โโ3.0, and how will it work?
EPFO 3.0 is a modern digital initiative for millions of employed people in the country. It aims to eliminate delays in PF transfers and withdrawals. Currently, PF withdrawals require online claim submission followed by KYC and company approval. This process takes 7 to 10 days, and manual verification is required for balances exceeding Rs 1 lakh.
Here’s the entire processย
UMANG App: First, check your eligible balance on the UMANG App.
QR Code Generation: A QR code will be generated through the app.
Instant Transfer: With this QR code, you will be able to transfer money instantly from a UPI-enabled ATM or directly to your bank account.
What will be the benefit to common employees from the new rule?
This new system will completely eliminate paperwork. Most importantly, withdrawals of up to Rs 5 lakh will be credited directly to your account without any employer approval. Claims that were previously repeatedly rejected due to document mismatches will also be eliminated. Currently, the EPFO โโmanages a fund of approximately โน28 lakh crore, which is linked to millions of working people across the country.ย
Will the pension be reduced if money is withdrawn from an ATM?
Employees are curious whether frequent withdrawals would affect their pensions. However, the government has clarified that this facility will not affect your pension (EPS).ย
“This ATM withdrawal facility applies only to your EPF balance, which includes employee and employer contributions. You can withdraw up to 75 per cent of your total PF balance through this method,” the Ministry of Labour clarified.
Your pension money (EPS Account) will be safe. According to the rules, a minimum of 10 years of service (EPS membership) is required to receive a pension after retirement. If an employee leaves a job after 10 years, they can withdraw their pension money. However, even if you withdraw your PF money in between, your service record will not be reset (zeroed). You will remain eligible for pension once you complete 10 years.ย