Provident Fund: Meaning and Overview

Employees and employers often misinterpret or misunderstand the meaning of EPF. Because even the basics leave them perplexed, they end up making mistakes at the time of online PF withdrawal. In this blog, we help you with the meaning of PF, its calculation and the procedure to withdraw, keep reading! 

What is a Provident Fund?

PF is a part of retirement savings scheme, it enables employees to save a part of their CTC for their pension fund. The employer and employee both contribute towards the fund. The amount accrued over time and the employee can place a request at the time of retirement or end of their employment with a particular employer for offline or online PF withdrawal. EPF helps you grow your retirement corpus in a significant way.

There are Three Types of Provident Funds, all Three of Them are Mentioned Below-

  • The general PF- This is the fund that is maintained by the government including local authorities, or railways, and other similar government bodies. And so, they are defined by the government bodies.
  • The Recognised PF- This PF is the one which is applied to most of the employees’ PF scheme. All the individuals employed by private companies that has more than 20 employees, enjoy this PF scheme. A UAN number is given to the employees who get Provident Fund. This helps you at the time of transferring your PF fund from one employer to another.
  • The Public PF- This PF is defined by the nature of investments that are being done on the part of employees. This is also associated to a minimum amount that needs to be deposited which is INR 50, it can go to a maximum of 1.5 lakhs INR. The maturity period is 15 years for the amount, employees can withdraw the amount only after that time. 

PFs are a Good Bet for Employees as They Can Grow their Money Easily with it. 

How to Calculate PF?

If you want to know what your PF amount is at any point of time, you should use an EPF calculator. The information that it requires is mentioned as follows-

  • Your current age, and expected retirement age.
  • Basic salary with the annual increment
  • Contribution towards PF both employer and employee
  • Earned interest rate on the EPF balance

After entering the aforementioned details, the calculator will show you the amount you will save till your retirement time. This may not be as precise but it will surely give you a ballpark figure. 

How to withdraw PF online? 

There are two conditions that must be met to make sure online PF withdrawal is done without any hassle. 

The two conditions are-

  • You must have a UAN and the mobile number should be activated and working
  • Your UAn should be linked with KYC

Step1– Go to UAN portal
Step 2– You can then login using the login ID and password
Step 3– Click manage> KYC in the the dropdown
Step 4– After you click on KYC, a screen will appear. There you must see the PAN, bank and Aadhar details, you can check if they are verified or not from there.
Step 5– You should now click on the tab online services and then the one that says claim form
Step 6- The screen that is shown next, there you should click proceed.
Step 7- Now, you should select the type of claim you are looking for. The tab you will see will ask you what you want to apply for.
Step 8- After applying, an OTP will be sent to you on the mobile number linked to aadhar card. 

You can use the number displayed on the screen afterwards to check the status of your claim. 

This is actually how simple the whole concept of PF is. We hope now you know well what is the meaning of PF, how you can proceed online PF withdrawal, and calculate the same on your own. 

Author Bio: Neelima Bansal is an experienced tech enthusiast, digital marketing specialist with HROne and blogger who is well known for his ability to predict market trends. Check out her blog at StoryBuzz

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