Provident Fund A provident fund is a mandatory retirement savings program managed by the government, commonly utilized in countries like Singapore, India, and other developing nations. These funds can be likened to a combination of 401(k) plans and Social Security in the United States, as well as having similarities with employer-sponsored pension funds. Employees contribute a portion of their salaries to the provident fund, with employers also required to make contributions on behalf of their workers. The funds are overseen and invested by the government, with the accumulated amount being accessible to retirees or, in some cases, their dependents. Additionally, the fund may provide benefits to individuals who are unable to work due to disability.
What is a Provident Fund?
One retirement benefit program is known as the Provident Fund. In simple terms, a fund manager invests the money in the market using monthly contributions from both employers and employees. Once an employee retires, the fund manager pays them a retiree allowance that consists of their principal plus investment income.
An employer and employees establish a provident fund for voluntary contributions, providing financial support for various situations such as resignation, retirement, illness, or death. Governed by the Provident Fund Act, this fund ensures the entitlements of employees and is regulated by the government. Viewing the provident fund as a retirement savings scheme makes its purpose clear.
Rephrased: Viewing the Provident Fund as a retirement savings scheme makes it easy to comprehend. Employees contribute 2-15% of their salary to the fund management company, which matches the employee’s contribution at an equal or higher rate. Upon retirement, the employee can withdraw both their savings and the fund’s investment returns, with a potential primary loss. Companies have a specified period for withdrawing accumulated funds, and the number of years worked at retirement usually dictates the premium percentage.
How to withdraw PF amount online?
What is PF? The Employee Provident Fund Organization’s (EPFO) efforts in digitization and leveraging advanced technology have simplified the process of accessing your Provident Fund (PF) balance online in recent years. With technology advancing rapidly across India and globally, many individuals are unfamiliar with how to access their PF funds. The online platform offers a convenient and reliable solution for both employers and employees. Here is a step-by-step guide on how to easily withdraw your PF amount online.
Verification of Eligibility
Verification and eligibility checks are essential procedures for withdrawing PF to guarantee safety and confirm the individual’s identity. Fulfilling the EPFO’s eligibility criteria is a prerequisite before commencing the digital withdrawal process. Typically, employees should have a minimum of 5 years of continuous service with an organization. However, exceptions are made for specific situations like urgent medical needs or unemployment.
Activate your Universal Account Number (UAN)
A distinct identification number, known as UAN, is assigned to each employee who contributes to EPF in an organization. It is essential to activate your UAN to facilitate PF withdrawals, which can be done conveniently on the EPFO portal with simple activation steps that are user-friendly even for beginners.
Link UAN to your Aadhaar
It is crucial to link your UAN with your Aadhaar card to qualify for receiving PF funds. This process ensures a seamless, convenient, and secure withdrawal process, and is necessary for verification and authentication purposes.
Details of the bank account and KYC
Employers must ensure that their UAN is current, and they should also verify all bank account and KYC documents. This is essential and mandatory for all employers to facilitate online withdrawals.
Enter the EPFO Portal login information
Applicants are required to input their UAN and password in order to access the EPFO member portal at the following link: https://unifiedportal-mem.epfindia.gov.in/memberinterface/. This step is crucial and cannot be bypassed by users.
Choose the Claim Option
Claiming your PF amount requires users to log into the portal, visit the claim option, click on ‘Online Services’, and select ‘Claim (Form-31, 19 & 10C)’ from the features and menu on the homepage.
Check Personal Information
Employees need to double-check their personal data on the screen to prevent errors and delays. Verify that the details provided align correctly with your UAN.
Select & pick your preferred Withdrawal Type
Choose the kind of withdrawal you prefer according to your comfort or knowledge and proceed by performing it:
- PF Advance (Form 31): To withdraw a portion or whole amount of your PF sum for various reasons and uses, such as urgent medical, living expenses, housing, any occasion, marriage, migrating, education, and many more.
- Final PF Settlement (Form 19): To withdraw the needed amount of PF balance following retirement and job or employment quitting. It is based on the workers’s needs and preferences.
- Pension Withdrawal Benefit (Form 10C): It is beneficial to take and withdraw the pension money out of the financial plan or system.
Complete Details
Please provide accurate and complete personal information when filling in the required details for your PF withdrawal to avoid any delays, cancellations, or rejections. It is crucial to provide precise information to ensure a smooth and fast processing of your PF withdrawal.
Schemes Offered Under EPFO
Given below are the three schemes that are offered under EPFO:
- Employees’ Provident Funds Scheme 1952 (EPF)
- Employees’ Pension Scheme 1995 (EPS)
- Employees’ Deposit Linked Insurance Scheme 1976 (EDLI)
Objectives of EPFO
The EPFO’s primary goals are as follows-
- To ensure that each employee only has one EPF account.
- Compliance must be made as simple as possible.
- Ensure that organizations follow all of the EPFO’s rules and regulations regularly.
- To assure the dependability of internet services and to increase their facilities.
- All member accounts should be easily accessible online.
- Claim settlement times will be lowered from 20 to 3 days.
- Encouragement and promotion of voluntary compliance.
UAN & EPFO Portal
EPF subscribers can manage their PF accounts online, including tasks like withdrawals and checking balances. The EPFO issues a unique 12-digit UAN to each member, which remains the same even if the member switches employers. This UAN streamlines access to the EPFO member portal; when a member changes jobs, their member ID changes and gets linked to the UAN. Nevertheless, employees need to activate their UAN to utilize online services.
