EPFO Board clears main reforms to simplify withdrawals, minimize litigation, increase digital providers

The Central Board of Trustees (CBT) of the Workers’ Provident Fund Organisation (EPFO) accepted a set of landmark reforms at its 238th assembly held in New Delhi on October 13, in line with the Ministry of Labour and Employment. The assembly was chaired by Union Minister for Labour and Employment, Dr Mansukh Mandaviya and attended by Minister of State Shobha Karandlaje, Labour Secretary Vandana Gurnani and Central Provident Fund Commissioner Ramesh Krishnamurthi.

The ministry mentioned the selections mark a big shift in the direction of making EPFO providers extra member-centric, clear and digitally environment friendly. The initiatives embrace simplified withdrawal provisions, rationalised penal damages, doorstep pension providers and the rollout of the EPFO 3.0 digital transformation framework.

Simplified and liberalised withdrawal provisions

To make the Workers’ Provident Fund extra versatile and accessible, the CBT has accepted a simplified and liberalised framework for partial withdrawals. 13 current provisions have been consolidated right into a single, clearer construction with three classes – important wants reminiscent of sickness, schooling and marriage; housing necessities; and particular circumstances.

Members will now be allowed to withdraw as much as 100 per cent of their eligible provident fund steadiness, together with each worker and employer contributions. The variety of permissible withdrawals has additionally been elevated, with schooling withdrawals now allowed as much as 10 instances and marriage as much as 5 instances, in contrast with the sooner mixed restrict of three.

The requirement for minimal service has been lowered to 1 yr for all classes. Importantly, members will now not must state particular causes for withdrawal underneath ‘particular circumstances’, making the method less complicated and fewer liable to rejection.

A brand new rule mandates sustaining a minimal steadiness of 25 per cent of the whole contributions, permitting members to proceed incomes compound curiosity – at present at 8.25 per cent every year, whereas securing a sustainable retirement corpus. These modifications, the ministry mentioned, are anticipated to allow totally automated declare processing with minimal paperwork.

Vishwas Scheme to resolve pending litigation

The Board additionally accepted the launch of the Vishwas Scheme to handle long-standing litigation linked to penal damages on delayed provident fund deposits. As of Might 2025, penal damages value Rs 2,406 crore have been pending throughout greater than 6,000 circumstances in varied courts and tribunals.

Below the brand new scheme, the speed of penal damages has been rationalised to a uniform 1 per cent per 30 days, with graded charges of 0.25 per cent for defaults as much as two months and 0.50 per cent for defaults as much as 4 months. The scheme will stay in impact for six months and could also be prolonged by one other six.

It covers ongoing litigation underneath Part 14B of the EPF Act, finalised however unpaid orders, and pre-adjudication circumstances the place notices have been issued however not concluded. As soon as employers comply underneath the Vishwas Scheme, pending circumstances will probably be closed.

The Labour Ministry mentioned the reform will cut back authorized prices and promote well timed compliance, whereas serving to employers keep away from pointless disputes and enabling sooner reinvestment of members’ funds.

Doorstep pension providers for EPS pensioners

The Board has additionally accepted a partnership between EPFO and India Put up Funds Financial institution (IPPB) to ship Digital Life Certificates (DLC) providers on the doorstep for pensioners of the Workers’ Pension Scheme (EPS) 1995.

The service, which will probably be freed from price to pensioners, will probably be made obtainable via IPPB’s intensive postal community. The Rs 50 payment per certificates will probably be borne fully by EPFO. The initiative goals to ease the method for aged and rural pensioners, making certain well timed pension disbursement, faster household pension initiation and higher verification underneath the Centralised Pension Fee System.

Digital transformation underneath EPFO 3.0

As a part of the EPFO 3.0 modernisation drive, the CBT accepted a complete digital transformation plan to combine superior applied sciences and automate key processes. The brand new member-centric framework will probably be powered by a hybrid core banking system, cloud-native design and API-based modules to streamline providers reminiscent of account administration, payroll integration and compliance.

Dr Mandaviya additionally launched a number of upgraded programs in the course of the assembly, together with a re-engineered return submitting module underneath the Centralised IT Enabled System (CITES) challenge. The brand new Digital Challan-cum-Return (ECR) course of simplifies employer compliance via a four-step workflow, enabling real-time validation and faster crediting of contributions.

Different digital upgrades embrace a re-engineered consumer administration module for improved safety, an upgraded e-Workplace for sooner file processing, and SPARROW –  a web-based efficiency appraisal system for clear evaluation of officers and workers.

Learn Extra: EPFO Board clears main reforms to simplify withdrawals, minimize litigation, increase digital providers

Strengthening funding and increasing social safety

The CBT accepted the appointment of 4 fund managers to supervise EPFO’s debt portfolio for 5 years, geared toward making certain prudent and diversified funding of members’ financial savings.

The Board additionally reviewed progress on a number of ongoing initiatives, together with the Pradhan Mantri Viksit Bharat Rozgar Yojana (PM-VBRY), a Rs 99,446 crore scheme launched in August 2025 to generate 3.5 crore jobs over two years. The ministry reported that in August alone, practically 6 lakh workers and over 79,000 institutions benefited from the scheme.

India’s efforts in increasing social safety have been not too long ago recognised on the World Social Safety Discussion board in Kuala Lumpur, the place Dr Mandaviya obtained the award for Excellent Achievements in Social Safety 2025. India’s social safety protection has expanded to 64.3 per cent of its inhabitants – a pointy rise from 19 per cent in 2015, giving the nation larger voting energy within the Worldwide Social Safety Affiliation (ISSA).

Upgrades in operations and infrastructure

EPFO additionally reported early credit score of curiosity at 8.25 per cent for 2024-25, accomplished by July this yr – sooner than in earlier years. The organisation has launched a number of digital services together with Passbook Lite, on-line Annexure Okay and Face Authentication Know-how (FAT) for sooner UAN activation via the UMANG app.