In a big relief to 50 lakh central government employees the government relaxed norms for withdrawal of money from their General Provident Fund accounts. The employees can soon withdraw their money and receive payments within 15 days. Employees can withdraw GPF for select purposes after completing 10 years of service, as against 15 years of service earlier. The money can be withdrawn for purpose of education (which includes primary, secondary and higher education), marriage of self and family members, in emergencies such as illness, buying property, cars and servicing bank loans.
Here are the key facts:
1. The relaxed rule for GPF withdrawal will benefit around 50 lakh central government employees as subscribers can withdraw the outstanding money for purpose of education - including primary, secondary and higher education, covering all streams and institutions.
2. Money can also be withdrawn for expenses such as marriage and other ceremonies of self or family members and dependants, illness of self, family members or dependants and purchase of consumer durables.
3. Government has permitted GPF withdrawal of up to twelve months pay or three-fourth (75 per cent) of the outstanding money in the General Provident Fund, whichever is less. In some cases such as for illness, the withdrawal may be allowed up to 90 per cent of the amount standing at credit of the subscriber.
4. Three-fourth or 75 per cent of the total outstanding amount in GPF can be withdrawn for purpose of buying a house, repayment of outstanding housing loan, purchase of land for building a house, constructing a house, reconstructing or making additions on a house already acquired and renovating, additions or alterations of ancestral house.
5. GPF money can also be withdrawn for the purpose of purchasing vehicles, repayment of car loans, repair and overhauling of vehicles and making deposit to book a vehicle.
6. For purchase of vehicle, a central government employee can withdraw 75 per cent of the amount at disposal in the GPF account or 75 per cent of the cost of vehicle whichever is less.
7. Employees can also withdraw 90 per cent of the money without giving any reason from their provident fund accounts two years before retirement from the job. Earlier the employees were allowed to withdraw 90 per cent of money only a year before their retirement.
8. In further relaxation, head of department of the concerned employee will have the power to sanction withdrawal from the provident fund accounts and no documentary proof will be required to be furnished. An employee would be required to give a simple declaration for the purpose of withdrawal.
9. In case of emergencies such as illness of employee or his or her family member the money from the GPF can be withdrawn within seven days.
10. The notification on GPF was dated March 7, 2017.