There is important news for nearly seven crore subscribers of EPFO. The COVID-19 advance facility has been discontinued with immediate effect. Lakhs of subscribers had availed this facility during the Corona period.
There is important news for people working in the private sector. The Employees Provident Fund Organization (EPFO) has announced the closure of the Covid-19 Advance Facility with immediate effect. During the first wave of the Corona epidemic, the facility of non-refundable advance was given to EPF members. After this, in view of the second wave of the epidemic, another advance was also allowed from May 31, 2021.
EPFO ​​has announced the closure of this facility in a circular issued on June 12, 2024. It says that now the Covid-19 epidemic is no longer there, so it has decided to close the advance facility with immediate effect. This decision will also apply to exempted trusts. A deduction of 12% is made on the basic salary of workers working in the private sector for the EPF account. Also, the company also deposits the same amount in the PF account of the employee.
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The provision of withdrawal of money from EPF accounts was first announced in March 2020 under the Pradhan Mantri Garib Kalyan Yojana (PMGKY). In June 2021, the Ministry of Labor announced that EPF members can get a second non-refundable advance from their EPF accounts. Earlier, only one-time advance facility was available for EPF members. EPFO ​​​​allows its members to make a non-refundable withdrawal of three months’ basic wages and dearness allowance or 75% of the amount available in the EPF account, whichever is lower. However, members can also apply for a lower amount. EPFO ​​​​has implemented auto-mode settlement for advance claims related to house, marriage and education.
Covid advance facility
As a Covid advance, EPF subscribers could make a non-refundable withdrawal of up to three months’ basic salary and dearness allowance or up to 75 per cent of the balance in the account, whichever was lower. For this, the member or the employer was not required to submit any certificate or document.
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If an employee, his parents, spouse or children fell ill due to Covid, the member had the facility to withdraw money. There was no lock-in period or minimum service requirement in this type of EPF withdrawal. According to the data, a total of 2.2 crore subscribers availed the Corona Advance facility, which is more than one-third of the total number of EPFO ​​​​members. This facility was started in 2020-21 and lasted for three years.
During this period, PF subscribers withdrew Rs 48,075.75 crore as Corona Advance. This information has been given in the Draft Annual Report 2022-23 of EPFO. According to the report, EPFO ​​distributed Rs 17,106.17 crore in 2020-21 which benefited 69.2 lakh subscribers. In the year 2021-22, 91.6 lakh subscribers availed this facility and withdrew Rs 19,126.29 lakh crore.
