EPF Withdrawal Via UPI May Start Soon: What Subscribers Need To Know

Accessing EPF money may soon become much simpler. The Employees’ Provident Fund Organisation is working on a system that will allow members to withdraw part of their EPF balance directly into their bank accounts using UPI. According to officials familiar with the matter, the feature is expected to be rolled out by April, once technical issues are fully resolved. Also Read: Making UPI Payments? These Simple Steps Can Help You Protect Your Money

How EPF Withdrawal via UPI Will Work

Under the proposed system, EPFO members will be able to see how much of their EPF balance is eligible for withdrawal. A portion of the total balance will remain frozen, while the remaining amount can be transferred to the member’s bank account. Also Read: Google Pay Launches Flex, A UPI-Based Digital Credit Card With Axis Bank: How It Works

The transfer will happen through a UPI-based payment gateway. Members will use their linked UPI ID and PIN to authorise the transaction, similar to how regular UPI payments work today. Once the money reaches the bank account, it can be used freely, whether for digital payments or cash withdrawal through ATMs. Also Read: ChatGPT On UPI App? PhonePe Partners With OpenAI, Here's What Will Be Changed

The move is meant to reduce the number of steps involved in withdrawing EPF money and cut down the waiting time.

Why EPFO Is Moving to UPI-based Withdrawals

At present, EPFO members have to submit withdrawal claims even to access their own money. Even though auto-settlement exists, the process still involves submitting an application and waiting for approval. Claims under the auto-settlement mode are usually processed within three days, and the limit for this has already been increased to Rs 5 lakh.

However, EPFO settles more than five crore claims every year, most of them related to withdrawals. The new UPI-based system is being designed to reduce this burden and make access faster for members.

Since EPFO does not hold a banking licence, it cannot allow direct withdrawals from EPF accounts like a bank. Routing withdrawals through linked bank accounts using UPI is seen as a practical workaround.

Changes to Partial Withdrawal Rules

Alongside the UPI plan, EPFO has also simplified partial withdrawal rules. Thirteen different provisions have now been merged into three broad categories: essential needs such as illness, education, and marriage; housing-related needs; and special circumstances.

With the changes being planned, members will be allowed to withdraw up to 100 percent of the eligible EPF balance, which includes both the employee and employer contribution. At the same time, 25 percent of the contribution will be kept as a minimum balance so that the account continues to earn interest and build a retirement corpus.

What This Means for EPF Members

Once the UPI-based withdrawal system is rolled out, members may be able to access their EPF money faster and with fewer formalities. Instead of having to file claims every time, members may find it easier to withdraw money when needed, while a portion of their savings continues to remain untouched for long-term use.