EPFO: EPFO members get a new option to transfer PF amount to pension account..

Employees' Provident Fund Organization (EPFO) members will now be able to withdraw their full PF and pension balances only if they remain unemployed for 12 months and 36 months, respectively. The EPFO's Central Board of Trustees, chaired by Labor and Employment Minister Mansukh Mandaviya, has also decided that each member must maintain at least 25% of their PF balance in their account at all times.

Previously, the EPFO had this rule:
Until now, a member could withdraw their entire balance after two months of continuous unemployment, with no minimum balance requirement. Minister Mandaviya announced on Tuesday that now 25% of the total balance will be retained in the account at all times, and the remaining 75% can be withdrawn up to six times a year.

Changes to this scheme were made at the board meeting on Monday. According to the new scheme, members will have the flexibility to withdraw funds periodically as needed, but a certain amount will also be secured for their retirement. This rule was introduced because 87% of members have less than ₹1 lakh in their accounts at the time of settlement.

300 million EPFO members will benefit
Mandaviya stated that members can also transfer their PF balance to a pension account if they wish. The Labor Ministry believes that this change will benefit approximately 300 million EPFO members. It will help them build a better retirement fund with the EPFO's 8.25% annual interest rate and the benefit of compounding.

The government says that this move will provide members with easier access to funds and also ensure they have sufficient savings for retirement.

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