The Employees' Provident Fund Organisation (EPFO) is planning to launch a Unified Payments Interface (UPI)-based system for provident fund withdrawals by April. This initiative aims to streamline and expedite access to EPF savings for its approximately eight crore subscribers.

Currently, EPFO members must file claims to access their EPF money, a process that can be time-consuming. The new UPI-based system intends to eliminate the need for manual applications, with the goal of processing eligible withdrawals electronically within three days, without human intervention.

Under the new system being developed by the labour ministry, a portion of the EPF balance will be locked, while a substantial share can be withdrawn seamlessly via UPI. Subscribers will be able to view the amount eligible for withdrawal in real time and approve transfers using their linked UPI PIN, ensuring a secure transfer of money into their bank accounts. Once the money is transferred, members can use it as they wish, including for electronic payments or ATM withdrawals using debit cards.

The EPFO is currently fine-tuning its software infrastructure to ensure a smooth launch. The organization is working to resolve software glitches for the smooth implementation of this system.

This initiative builds upon previous efforts to simplify EPF withdrawals. The auto-settlement limit for claims has already been increased to ₹5 lakh from ₹1 lakh, facilitating quicker access for urgent needs like illness, education, and housing. The EPFO has also merged 13 complex provisions for partial withdrawals into three streamlined categories: Essential Needs, Housing Needs, and Special Circumstances. Members can now withdraw up to 100% of their eligible balance, comprising both employee and employer shares. To maintain a sufficient retirement corpus, 25% of contributions will be kept as a minimum balance, allowing members to continue earning the current 8.25% annual interest.

The EPFO introduced online auto-settlement of advance claims during the COVID-19 pandemic to provide quick assistance to those facing financial difficulties. Under the auto-settlement mode, withdrawal claims are settled electronically without manual intervention within three days of filing the application form.

According to Labour Secretary Sumita Dawra, the EPFO has introduced several changes over the past months to improve pension services, speed up provident fund claim processing, and enhance its IT infrastructure. In the current financial year (FY25), EPFO processed claims for over 50 million subscribers and disbursed more than ₹2.05 lakh crore.

To transfer PF online, members must have an active UAN (Universal Account Number), and the mobile number used for activation must also be active. The member's bank account and IFSC code should be linked to the UAN, and the employer should have approved the e-KYC.