The Employees’ Provident Fund Organisation (EPFO) has rolled out major changes to the Employees’ Pension Scheme (EPS) for 2025, a move set to significantly impact pension benefits for salaried employees. The updates focus on higher payouts, greater flexibility, and a fully digital claims process.
Higher Pension Ceiling Announced
One of the most notable changes is the increase in the maximum monthly pension limit. The ceiling has been raised from ₹7,500 to ₹15,000, offering better retirement security to employees who have contributed based on their actual salaries. The revision is aimed at ensuring pension payouts are more closely aligned with an employee’s earnings during service.
Changes to Early Withdrawal Rules
EPFO has also revised the rules governing early pension withdrawals. Employees will now be allowed to withdraw up to 100% of their eligible pension amount, provided at least 25% of the balance remains in the account to safeguard long-term retirement savings. At the same time, the waiting period for full withdrawal after job loss has been extended from two months to 12 months, encouraging employees to retain pension funds for the long term.
Digital Claims and Centralised Payments
In a push towards greater efficiency, EPFO has digitised most pension-related services. Pension claims can now be filed entirely online, reducing paperwork, speeding up processing, and eliminating the need for physical visits.
The introduction of the Centralised Pension Payment System (CPPS) is another key reform. Under this system, pensioners can receive payments in any bank account, irrespective of where their Pension Payment Order (PPO) was issued, making the process more seamless and accessible.
What Employees Should Do
The latest EPS reforms are designed to make the pension framework more inclusive, flexible, and technology-driven. Employees are advised to verify and update their EPFO records and familiarise themselves with the new digital services to fully benefit from the changes introduced in 2025.
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