EPFO members can withdraw EPF directly via UPI by April
Once credited to their bank accounts, members can use the funds freely — make digital payments, transfer money, or withdraw cash from ATMs
New Delhi: EPFO subscribers will be able to withdraw their employees’ provident fund (EPF) directly to their bank accounts through UPI payment gateway by April this year, a top source has said.
The labour ministry is working on a project where a certain proportion of the EPF will be frozen, and a large chunk will be available for withdrawal through their bank account using Unified Payment Interface (UPI), the source told PTI.
He explained that the subscribers will be able to see the eligible EPF balance available for transferring into their seeded bank accounts. They will be allowed to use their linked UPI pin for completing the transaction to ensure a secure transfer of money into their bank accounts.
Once the money is transferred into bank accounts, the members can use the money the way they want, like making payments electronically or withdrawing through bank ATMs using debit cards.
The source stated that the Employees’ Provident Fund Organisation (EPFO) is trying to resolve software glitches for the smooth implementation of this system, which will benefit around eight crore members. At present, the members of EPFO have to apply for withdrawal claims to access their EPF money, which is time-consuming.
Under the auto-settlement mode, the withdrawal claims are settled electronically without manual intervention within three days of filing the application form. The limit of this auto-settlement mode has already been raised to Rs 5 lakh from the existing Rs 1 lakh. This will facilitate a large number of EPFO members to access their EPF money within three days for illness, education, marriage, and housing purposes.
EPFO, which has about 8 crore members, first introduced online auto-settlement of advance claims during the Covid-19 pandemic to provide quick assistance to those facing financial crunch.
However, all members have to file claims to access their own EPF. The new system is being evolved to avoid this time-consuming process and reduce the burden of the EPFO, as over 5 crore claims, mostly for withdrawing EPF, are settled every year.
The source said that the EPFO cannot allow its members to withdraw money directly from the EPF accounts because the body does not have any banking licences. However, the source said, the government wants to improve the services of the EPFO on par with banks.
Earlier in October 2025, the EPFO’s apex decision-making body, the Central Board of Trustees (CBT), had approved simplification and liberalisation of EPF partial withdrawal provisions. Now, these provisions will be notified shortly as minutes of the meeting containing the decision have been approved by Union Labour Minister Mansukh Mandaviya.
To enhance the Ease of Living of EPF members, the CBT had decided to simplify the partial withdrawal provisions of the EPF Scheme by merging 13 complex provisions into a single, streamlined rule categorised into three types, namely, Essential Needs (illness, education, marriage), Housing Needs and Special Circumstances.
Now, members will be able to withdraw up to 100 per cent of the eligible balance in the Provident Fund, including employee and employer share. Provision has been made for earmarking 25 per cent of the contributions in the Members’ account as Minimum Balance to be maintained by the member at all times.
This will enable the member to enjoy a high rate of interest offered by EPFO (currently 8.25 per cent per annum), along with compounding benefits to accumulate a high-value retirement corpus.
This rationalisation enhances ease of access while ensuring members maintain a sufficient retirement corpus. Scheme provision simplification, along with greater flexibility and zero need for any documentation, will pave the way for 100 per cent auto settlement of claims for partial withdrawal and ensure ease of living.
