COVID-19 has had a considerable impact on economies around the world. In India, the first two waves of the pandemic left several families staring at a financial crunch. Now, with the rise in the number of Omicron cases, things have again begun to get difficult. The government, in 2020, had allowed for tax-free, non-refundable Employees' Provident Fund (EPF) COVID-19 advance. This was followed in 2021, too, with the people allowed to obtain a second COVID-19 EPF advance.
The provision for this special withdrawal was introduced in March 2020, under Pradhan Mantri Garib Kalyan Yojana (PMGKY). As of May 31, 2021, the Employees' Provident Fund Organisation (EPFO) has settled over 76.31 lakh COVID-19 advance claims, disbursing Rs 18,698.15 crore.
Will the government allows a third Covid-19 EPF advance? Here's what you can do if it does so.
In the FAQ section of the Employees' Provident Fund Organisation, question number 199 deals with the processing of claims. It states that “claims for advance to fight COVID-19 pandemic are being processed on priority considering the exigency of the situation”.
In the FAQ section's “select category” drop-down list, choose “claim and withdrawals”, and in the “select subcategory” list opt for “Covid FAQ”. There point number 6 states, “EPFO settles claims for availing advance to fight COVID-19 pandemic within 3 working days.” This would make the EPF COVID advance a good option if you are in need of funds at the earliest.
The EPF is especially useful if you are staring at huge medical expenses or are faced with a sudden loss of a job.
If the pandemic has already caused you to borrow over your means and pile on one loan upon another, the EPF can go a long way in battling unplanned financial disruptions. Using the EPF is always a better option than piling on more debts in uncertain times.
EPF can be applied online entirely and will be credited to your bank account, allowing you to obtain the money even if you are operating out of a remote location or are under quarantine for instance. Click here for the step-by-step process to claim your provident fund withdrawal online.
However, experts advise that ease of access to EPF should not be the sole reason to dip into it immediately. Since EPF earns you a higher interest rate, experts opine that it is best to leave it untouched for as long as possible. Only after you have exhausted all other options, should one lean on EPF.