Soon, PF Withdrawals via UPI and ATM Likely: EPFO Plans Major Upgrade in June for Emergency Access

31 May, 2025
Soon, PF Withdrawals via UPI and ATM Likely: EPFO Plans Major Upgrade in June for Emergency Access

Winning Bizness Desk

Mumbai.The Central Government is preparing to roll out a significant upgrade to the Employees’ Provident Fund Organisation (EPFO) system in June. According to media reports, under the upcoming EPFO 3.0 framework, subscribers may soon be able to withdraw funds directly from their Provident Fund (PF) accounts using ATMs and UPI. This change is aimed at making PF funds more accessible during emergencies without compromising long-term retirement savings.

Withdrawal Cards to Function Like Bank ATMs

Under EPFO 3.0, subscribers will be issued special withdrawal cards linked to their PF accounts. These cards will work similarly to bank ATM cards, enabling users to withdraw a fixed amount of money. The withdrawal limit will ensure that while subscribers can access funds during critical situations, the bulk of their retirement corpus remains protected.

How UPI and ATM Withdrawals Will Work

To enable this feature, EPFO will link the withdrawal cards to the subscribers' PF accounts. Using these cards, members will be able to withdraw funds directly from designated ATM machines. For UPI-based withdrawals, members will need to link their PF accounts with their UPI IDs. Once linked, funds can be transferred from the PF account to the member’s bank account through UPI platforms.

75% PF Withdrawal Allowed After Job Loss

According to existing withdrawal norms, a PF member who loses their job can withdraw up to 75% of their PF balance after one month of unemployment. The remaining 25% can be withdrawn after two months. This provision ensures that subscribers have access to funds during periods of joblessness while still preserving a portion for future needs.

Income Tax Rules on PF Withdrawals

Income tax regulations state that if an employee has completed five years of continuous service—either in one company or combined across multiple employers—there is no tax liability on PF withdrawals. However, if an employee withdraws more than ₹50,000 before completing five years of service, a 10% TDS is applicable. Without a PAN card, the TDS rises to 30%. Employees can avoid TDS by submitting Form 15G or 15H, provided they meet the eligibility conditions.

Story in a Nutshell: Key Points:

  • EPFO to introduce PF withdrawal via UPI and ATM starting June under EPFO 3.0.
  • Subscribers will get withdrawal cards functioning like regular ATM cards.
  • Only a fixed amount can be withdrawn to protect retirement savings.
  • UPI-based withdrawals will require PF account linkage with UPI.
  • After job loss, 75% PF can be withdrawn after 1 month, and remaining 25% after 2 months.
  • No tax on PF withdrawals after 5 years of service (across one or more employers).
  • Early withdrawals over ₹50,000 attract 10% TDS; 30% if PAN is not provided