The Employees' Provident Fund Organisation (EPFO) is mulling the idea of introducing limits on the amount that can be withdrawn from Provident Fund prior to retirement, reported Business Standard.

According to the report, EPFO has proposed that its members can withdraw only 60 percent of their total savings or an amount equivalent to three months' salary, i.e. whichever is lower if they remain unemployed for a month.

In addition, the report adds that individuals will be allowed to withdraw 80 percent of PF savings or an amount equivalent to two months' salary, i.e. whichever is lower if they remain unemployed for two months.

The new development comes after concerns emerged about high level of PF withdrawals by members, the report said. Presently, members are allowed to withdraw the entire amount from their provident fund if they remained unemployed for more than two months.

The proposal to limit the amount that can be withdrawn from the PF may likely meet severe opposition. According to a report in Business Today, a notification by the Labour Ministry in 2016, restricting full withdrawal of provident fund by members after unemployment of more than two months had to be dropped following opposition from trade unions and other stake holders.

First Published:Jun 20, 2018 10:04 AM IST