New Delhi, July 4, 2024: Great news for employees! If your PF is being deducted then this news is going to prove very useful for you. A great scheme run by EPFO is now benefiting people on a large scale.
The government made a big change in the EPS scheme
The government has amended the Employees’ Pension Scheme (EPS) 1995. Now employees who have contributed less than 6 months will also be able to withdraw their money easily. Earlier, it was necessary to contribute a minimum of 6 months for withdrawal. Due to this, about 7 lakh claims of employees were rejected in the financial year 2023-24.
Who will benefit from this change?
This change will benefit more than 7 lakh EPS members every year. The amount of withdrawal benefit will now depend on the number of full months of service given by the member and the salary on which the EPS contribution has been made.
Understand an example:
Suppose an employee has completed 2 years and 5 months of contributory service and his salary is Rs 15,000 per month. Earlier, he could get Rs 29,850 as withdrawal benefit. Now, he will get Rs 36,000.
Why was there a need for amendment in EPS?
Every year, lakhs of pension scheme members leave the scheme before completing the 10 years of contributory service required for pension. Such members are provided withdrawal benefits as per the provisions of the scheme. In FY 2023-24, more than 30 lakh withdrawal benefit claims were paid. Withdrawal benefits were calculated based on the period of contributory service and the salary on which EPS contributions were made.
This change will be beneficial for employees who:
Work for a short period of time and are not able to qualify for pension.
Keep changing jobs and are not able to contribute to the same scheme for a long time.
In case of an emergency, there is an immediate need for money.
Conclusion:
This change is a big relief for employees who work for short periods or keep changing jobs. It will help them withdraw money from their PF in their time of need.
Note: This information is for general information only. Please consult a financial advisor before taking any financial decision.
