EPFO introduces UPI-enabled withdrawals and updates interest rules

The Employees' Provident Fund Organisation (EPFO) is introducing updates under the EPFO 3.0 initiative to streamline fund access and settlements. Key features include the ability for subscribers to transfer provident funds via UPI and perform withdrawals of 50 to 75 percent of their funds through UPI-enabled ATMs.

Under these new services, members can use their linked UPI PIN to transfer money directly to their bank accounts, significantly reducing the current 15-to-20-day processing timeline for claims. Additionally, the UMANG App will allow members to activate their Universal Account Number (UAN) using face authentication.

Regarding interest and taxation, EPFO rules state that interest continues to accrue on EPF accounts after leaving a job until the member reaches age 58. However, while interest earned up to the date of leaving a job remains tax-free, any interest accrued after employment ends is considered income from other sources and is taxable according to the individual's income tax slab. An account is deemed inoperative if no withdrawals are made for 36 months following retirement after age 55, or once the member reaches age 58.