Amidst the country struggling with the second wave of COVID and the emergence of allied fungal disease ‘black fungus’, which is now declared an ‘epidemic’, the government is trying its best to offer financial relief to PF account holders.
The Ministry of Labour and Employment announced a press release dated 31st May 2021 to allow the EPFO subscriber’s a non-refundable COVID advance for the second time.
The provision for special withdrawal was first introduced in March 2020 under Pradhan Mantri Garib Kalyan Yojana (PMGKY) to meet the financial need during the pandemic. The process and the provision of withdrawal of the second advance remain the same as the first one.
Under this provision, non-refundable withdrawal can be made of an amount lower than the below mentioned-
- Basic wage and dearness allowance for three months pay, or
- 75% of the credit balance amount in the EPF account
The amount mentioned above is the maximum threshold that the subscriber can withdraw; however, members can also apply for a lesser amount.
The government stated that the members who had benefited from the first COVID advance could also opt for the second advance from their PF account.
EPFO stated that they are committed to settling the COVID claims on priority. The organisation further committed to settling the COVID claims within three days of the receipt. Also, they have deployed a system driven auto claim settlement mechanism for all the members whose KYC requirements are complete. The auto settlement mode will enable EPFO to reduce the claim settlement cycle to 3 days.
The first COVID advance has been of great help to the EPF members at the pandemic, especially for those earning less than Rs.15,000 wages monthly. EPFO settled more than 76.31 lakh COVID claims with an amount of disbursement of Rs.18,698 crore.
This relief comes after the Ministry of Labour and Employment announced extending the benefits under the ESIC scheme and EDLI scheme of EPFO. The insurance and pension benefits already available under the EDLI and ESIC scheme are also made available to the families of the deceased employee due to COVID, provided some conditions are met.
These welfare steps by the government will offer needed support to the families of sail through the financial hardships during these trying times.
For any clarifications/feedback on the topic, please contact the writer at jyoti.arora@cleartax.in
I am a Chartered Accountant by profession with 4+ years of experience in the finance domain. I consider myself as someone who yearns to explore the world through travelling & Reading. I believe, the knowledge & wisdom that reading gives has helped me shape my perspective towards life, career and relationships. I enjoy meeting new people & learning about their lives & backgrounds. My mantra is to find inspiration from everyday life & thrive to be better each day.
