The power of composition! It is the beauty of deposits in retirement savings such as the employee provident fund which currently offers an interest of 8.25% on contributions.
Specified by a high number of withdrawals by young subscribers, the organization of employee provident funds examines strategies to solve this problem and how it can be dealt with.
“In several cases, it is found that subscribers remove their entire PF corpus at the time of change of employment.
Sources have indicated that EPFO is trying to explore strategies to encourage the habit of retirement savings, especially among young subscribers.
Under the current EPF rules, a member can withdraw the entire PF corpus after retirement. However, the rules allow members to also be able to withdraw up to 75% of the PF corpus after a month of unemployment and 100% of the corpus after two months of unemployment.
Although the objective of the rule is to ensure that workers who face job losses or unemployment can fall back on their PF corpus to alleviate them, often, subscribers of the EPF after having resigned from employment, withdraw their corpus after a two -month expectation.
Officials have said that this may be for several reasons such as investment in other instruments such as actions where yields can be higher or use the corpus for a purchase. “Several times, young people believe that it is not necessary to save for retirement because it is in several years.
According to official data, the EPFO received a total of 7.1 million complaints for the final PF regulations between April 1, 2024 and March 7 of this year. From that, he had set 50 million complaints amounting to Rs 55,133.52 crore. The number of EPFO member accounts has increased to 325 million, compared to 117 million in the last 10 years of the year 2015 to March 7, 2025.
