EPFO subscribers alert! Covid withdrawal facility may be stopped soon: Report

The Employees' Provident Fund Organisation (EPFO) has reportedly shut the Covid-19 withdrawal facility that allowed its subscribers to take out a part of their retirement savings as Covid advances, the Economic Times reported. While there is no official notification in this regard yet. Mint could not independently verify this development.

Amid the 2020 pandemic that had jolted the entire world, EPFO allowed its members to opt for two advances from the Employees' Provident Fund (EPF) account.

The provision for special withdrawal to meet the financial needs of members during the pandemic was introduced in March 2020, under Pradhan Mantri Garib Kalyan Yojana (PMGKY). An amendment to this effect was made by the Ministry of Labour & Employment in Employees’ Provident Funds Scheme, 1952 by inserting therein sub-para (3) under paragraph 68L, through notification in the Official Gazette.

Under this provision, non-refundable withdrawal to the extent of the basic wages and dearness allowances for three months or up to 75% of the amount standing to the member's credit in the EPF account, whichever was less, was provided. 

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EPFO, the retirement fund body, mandates both employees and employers to contribute 12 per cent of the basic salary and dearness allowance. It not only serves as a tax-saving instrument but also offers higher interest rates on investments.

EPFO adds 15.29 lakh members in October

The retirement fund body added 15.29 lakh members on a net basis in October, up by 18.22 per cent compared to the same month last year, according to payroll data released on December 20. Around 7.72 lakh new members have come under the social security coverage of EPFO in October 2023, an increase of 6.07 per cent over the year-ago month, a labour ministry statement said.