End of COVID-19 Advance Facility
During the Covid-19 outbreak, EPFO provided a non-refundable advance to assist members suffering financial difficulties. The service was initially available during the first wave of COVID-19 in March 2020 and was extended during the second wave beginning May 31, 2021.
A notice dated June 12, 2024, has been released by EPFO, which stated, As COVID-19 is no longer a pandemic, the authority has decided to end the advance immediately. This applies to exempted trusts as well. Please inform all trusts in your jurisdiction.”
Details of COVID-19 Advance Withdrawal
EPFO allows members to withdraw up to three months’ basic earnings and dearness allowance, or 75% of their EPF account balance, whichever is less. Members can request smaller amounts if necessary.
The amount comprised the employee’s contribution, the employer’s contribution, as well as interest. No certificates or papers were required from the employee or employer.
Eligibility for Withdrawal
Members could withdraw funds if they, their parents, partners, or children became ill as a result of Covid-19. This withdrawal did not include a lock-in term or a minimum service obligation. Since it doesn’t need any certificates or papers, any member can take advantage of the facility and withdraw the money even if they were not affected by COVID-19.
How COVID-19 Advance Was Calculated?
Calculating the COVID-19 advance was very easy. For instance, if an employee had an EPF balance of Rs 1,00,000 and a monthly basic salary and dearness allowance of Rs 30,000, the member could withdraw either 75% of the balance (Rs 75,000) or three months’ wages (Rs 90,000). In this situation, the member would receive Rs. 75,000.
What’s the Impact of Ending COVID-19 Advance Facility?
Ending the COVID-19 advance facility implies EPFO’s return to normal functioning. Members can no longer make special withdrawals, although they can still withdraw funds for housing, education, and medical situations.
Wrapping Up
While this adjustment affects some members, EPFO continues to provide numerous withdrawal choices for financial requirements.
