On 15 October 2025, the Ministry of Labour & Employment issued an official press release through the Employees’ Provident Fund Organisation (EPFO), clarifying recent reforms under the Employees’ Provident Fund (EPF) and Employees’ Pension Scheme (EPS).
These changes were approved by the Central Board of Trustees (CBT) to simplify withdrawal rules, enhance digital access, and improve processing efficiency — while still safeguarding retirement savings.
The press release also aimed to counter misinformation circulating on social media and to guide both employers and employees about the true scope of the amendments.
Key Changes As Per Press Release
a) Unified & Simplified Withdrawal Framework
Earlier, EPF partial withdrawals were governed by multiple provisions for different purposes such as marriage, illness, education, or housing.
Now, all these have been merged into one simplified withdrawal system, which:
- Allows members to withdraw from both employee and employer contributions with interest.
- Reduces the minimum service requirement to 12 months (earlier it was 5–7 years for certain categories).
- Brings uniformity in eligibility conditions across withdrawal purposes.
This unified structure ensures that members no longer need to navigate different rules for each withdrawal category.
b) Enhanced Withdrawal Access Including Employer Contribution
One of the most impactful reforms is that withdrawals can now include the employer’s share of contribution (along with the employee’s share) under certain conditions.
Under the simplified framework, eligible members can now withdraw up to 75% of their accumulated balance for approved purposes like housing, medical emergencies, or job loss.
This rule offers greater liquidity, especially for middle-income salaried employees, while ensuring that a portion of the corpus remains protected for retirement.
c) Minimum Corpus Protection & Pension Scheme Safeguards
While EPFO has liberalised access to the provident fund, it has simultaneously introduced minimum corpus retention requirements to protect retirement savings.
For members of the Employees’ Pension Scheme (EPS), the waiting period for final settlement has been extended from 2 months to 36 months after cessation of employment.
This measure aims to discourage early complete withdrawals and promote long-term financial security.
d) Faster Processing & Digitalisation of EPF Services
The reforms also focus heavily on speed and digital efficiency.
Key enhancements include:
- Auto-settlement limit for advance claims raised from ₹1 lakh to ₹5 lakh, allowing faster disbursal for small withdrawals.
- Simplified claim-verification process with reduced documentation.
- UAN and Aadhaar-based digital processing for most withdrawal and transfer requests.
- Reduced dependence on employer approval in many categories, enabling direct processing through the EPFO system.
These changes are aimed at improving transparency, reducing delays, and empowering members to access funds quickly through online platforms.
e) Clarification on Misleading Information
The October 2025 press release clearly stated that various social media posts misrepresented the EPF withdrawal rules, creating unnecessary panic among members.
EPFO clarified that:
- There is no blanket approval for full withdrawal of EPF balances while still in service.
- The 100% withdrawal is only permitted upon retirement, or as per eligibility under specific provisions.
- Members are urged to rely solely on notifications issued by EPFO or the Ministry of Labour & Employment for authentic information.
3. Practical Advice / Checklist for Implementation
For Employees / Members
- Confirm that at least 12 months of continuous service is completed before applying for any withdrawal.
- Remember that both employee and employer contributions can be withdrawn under eligible conditions.
- Maintain a minimum balance in your EPF account for long-term benefit and interest accrual.
- If covered under EPS-95, note that final pension settlement can be applied for only after 36 months of leaving employment.
- Use UAN-linked Aadhaar login for faster online claim processing.
For Employers
- Ensure timely ECR filing and contribution deposits so employee claims are processed smoothly.
- Educate employees about new withdrawal options and restrictions.
- Keep all employee records updated in the EPFO portal (including KYC, Aadhaar, PAN, bank details).
- Since employer contributions are now accessible for withdrawal, verify the reconciliation of contributions monthly.
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