What is PF: Overview of provident fund and how to grow your PF

Read to know more about the types of PF, its benefits, and the advantage of investing PF Money in Fixed Deposit.

OPEN FD
3 mins
16 August 2023

Each investment is aimed towards three financial goals: build wealth, have a regular income from a pension when we retire, and protect the future of our families. And, while we purchase separate financial items to attain each of these objectives, there is one product that aids in the achievement of all three objectives. Because it is a part of our pay, the majority of us are not only aware of it, but actually invest in it. Employee Provident Fund, or EPF, is the product.

Provident Fund is a government-managed retirement Savings Scheme for employees who can contribute a part of their pension fund every month. These monthly savings get accumulated every month, easily accessible as a lump sum amount at retirement or the end of employment. Since the Provident Fund money is a large chunk of savings, it can quickly grow your retirement corpus.

What are the provident fund benefits?

The following are some of the EPF's advantages:

  • It aids in long-term financial planning.
  • There is no need to invest in a single, lump-sum amount. Employees' salaries are deducted on a regular basis, which allows them to save a significant amount of money over time.
  • It may be able to assist an employee financially in the event of an emergency.
  • It aids in the saving of money for retirement and the maintenance of a healthy lifestyle.

Eligibility Criteria for Employee’s Provident Fund

The following are the eligibility requirements for enrolling in the EPF scheme:

  • Registration for an EPF account is required for salaried employees earning less than Rs. 15,000 per month.
  • If a company employs more than 20 people, it is required by law to enrol in the EPF plan.
  • On a voluntary basis, businesses with fewer than 20 employees can join the EPF plan.
  • Employees earning more than Rs. 15,000 can open an EPF account, but they must first receive permission from the Assistant PF commissioner.
  • The EPF scheme's requirements apply to the entire country of India (except for the states of Jammu and Kashmir).

Types of Provident Funds

There are mainly three different types of PFs, which are as follows:

  • The general Provident Funds is a type of PF maintained by government bodies, including local authorities, the railways, and other such bodies.
  • The recognised Provident Fund is the one that applies to all privately owned organisations that have more than 20 employees. Moreover, holding a rightful claim to the PF associated with your organisation, you will be given a UAN or Universal Account Number. This enables you to transfer your PF funds from one employer to another whenever you move from one occupation to another.
  • The Public Provident Fund is defined by the voluntary nature of investment on the part of the employee. The PPF is also associated with a minimum deposit of Rs. 50 and a maximum amount of Rs. 1.5 lakh. The PPF has a lock-in period of 15 years.

Besides the PF, another safe investment that enables wealth generation is the Bajaj Finance Fixed Deposit. With this provision, you enjoy the benefit of attractive FD interest rates at flexible investment tenure options. Another advantage is the Bajaj Finance FD, which allows you to invest conveniently through a 100% digital process.

Provident Fund contribution

Both the employer and employee make equal contributions to the EPF account as shown below.

Contribution by Monthly Percentage Contributed
Employer 12.00%
Employee 12% or 10%
Total 24.00%


Points to Consider When Making an EPF Contribution:

  • 12 percentage point 3.67 percent EPF and 8.33 percent EPS are included in the employee contribution.
  • 10% of the total organisations with 20 or less employees/organizations with losses more than or equal to net worth (at the end of the financial year)/organizations designated sick by the Board for Industrial and Financial Reconstruction are eligible to contribute to the EPF.
  • The employer's total payment is split between the Employees' Pension Scheme and the Employees' Provident Fund, with 8.33 percent going to the the Employee Pension Scheme and 3.67 percent going to the Employee Provident Fund.
  • The EPF passbook is updated with all donations.
  • The employee's contribution is applied entirely to the employee's Provident Fund.
  • Aside from the contributions already made, the employer must contribute an extra 0.5 percent to EDLI.
  • The employer must additionally pay some administration charges for EDLI and EPF, which are 1.1 percent and 0.01 percent, respectively. This means that the employer is required to contribute a total of 13.61 percent of the employee's salary to the plan.

How to check your PF balance

Those looking to check their PF details must have an active Universal Account Number (UAN), which can help them review their PF account balance. Here are the steps to check your Provident Fund online balance:

  • Visit the EPFO website.
  • Enter your UAN and password.
  • View and download your EPF account statement.

You can also check your balance by giving a missed call on, from your registered phone number.

PF balance check by sending an SMS

UAN activated members can check their latest PF contribution and balance available with EPFO by sending an SMS at 7738299899 from registered mobile number. “EPFOHO UAN״ to 7738299899.

PF balance check through a missed call

An EPFO member can check their PF balance by using EPFO missed call service by giving a missed call on 011-22901406 from its UAN registered mobile number.

PF balance check using the Umang/ EPFO app

Here is how one can check the PF balance by using the Umang/ EPFO app:

  • After downloading the Umang/ EPFO app, click on 'member' and then go to 'balance/ passbook'.
  • Enter your UAN and registered mobile number. The system will verify your mobile number against your UAN. If all the details are verified, you can view your updated EPF balance details.

How to withdraw, claim or transfer PF?

When it comes to withdrawing funds from your PF account, you can either choose to submit a physical application or an online application. The best way to do this is to visit the EPFO website and use any of the following means to initiate a transfer or a withdrawal process:

  • UAN
  • Digital signature
  • Aadhaar Card and personal details

You can also read about Provident Fund information online on the EPFO website. For PF online transfer, the form that needs to be filled up is Form 13. On the other hand, the documents associated with withdrawal or claims include Form 31 (part withdrawal of PF funds), Form 10C (pension withdrawal) and Form 19 (final PF settlement).

Invest in fixed deposit

When you withdraw money from your Provident Fund account, you get a surplus amount to use as your retirement fund. You can consider investing in fixed deposits to protect your Provident Fund amount from market fluctuations and earn high returns.

Bajaj Finance Fixed Deposit offers one of the highest interest rates, up to 8.35% p.a. going up to 8.60% p.a. for senior citizens. You can also choose the tenure and frequency of your interest payouts.

Bajaj Finance Fixed Deposits have the highest safety ratings accredited by CRISIL and ICRA, so your investments are always secure. Check the online procedure to open an FD account and start investing.

To calculate the maturity amount of fixed deposit amount Use FD calculator.


Calculate your expected investment returns with the help of our investment calculators:

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FAQs (Frequently Asked Questions)

What is Provident Fund and how it works?

An Employee Provident Fund (EPF) is a retirement savings plan for salaried employees who work for a company with 20 or more employees. Overall, the Employee Provident Fund is an excellent approach to save money for retirement. It also serves as an emergency fund in case you need money for medical expenditures, a wedding, or mortgage payments.
Steps to follow:

Step 1: The EPF deductions are made from the salary.
Step 2: All EPF funds are pooled.
Step 3: Withdrawal of Employee Provident Fund under specific conditions.

Is PF mandatory for salary below 15000?

If you are a salaried employee earning less than Rs. 15,000 per month (basic + dearness allowance), your employer is required to register an EPF account for you.

When can I withdraw my PF?

Only after you retire may you withdraw your entire PF balance. Only once you reach the age of 55 will you be able to retire. You will not be able to get your complete pension if you retire before reaching this age. However, one year before you retire, you are entitled to receive 90% of your EPF corpus.

How can I check my PF balance?

Find simple steps to check your PF status click here.

How can I get my UAN number?

You can get your UAN number by multiple methods. Know more.

How can I know my UAN password?

To reset or modify your UAN password, follow the procedures below:

Step 1: Visit the EPF's web portal.
Step 2: On the site, on the right side, click 'forgot password.'
Step 3: Enter your UAN and captcha on the next page that appears, then click 'submit.'
Step 4: Enter your UAN again, followed by your registered cellphone number, and then select 'Yes.'
Step 5: On the same number that you entered, you will now receive an update.
Step 6: You can create a new password once your phone number has been validated. For confirmation, you will be required to enter the same new password twice. When you are finished, click 'submit.'

Now, use the new password to log in to the portal once more.

How can I check my PF balance?

You can check your PF balance in a few ways, as mentioned below:

  • EPFO portal: You can check your PF balance from your EPF e-passbook available on the EPFO portal. You can log in to the portal with your UAN.

  • UMANG app: You can also check your PF balance using the UMANG (Unified mobile app for new governance) app. You can receive a link to download the app by giving a missed call to 9718397183. You can also download it from the UMANG website or the app stores.

  • Missed call service: Members registered on the UAN portal can give a missed call to 011-22901406 from their registered mobile number. If your UAN is linked with your bank account number, PAN card number or Aadhaar number, you will receive an SMS with the details of your last EPF contribution and PF balance.

  • SMS service of EPFO: Members with activated UAN can also send an SMS with the text EPFOHO UAN ENG (ENG: your preferred language) to 7738299899 from their registered mobile number. This facility is available in 10 regional languages.
How can I get my PF UAN number?

You can get your UAN from your employer. Most companies print UAN numbers on the payslips. However, if your employer has not yet shared your UAN number with you, you can find it by following these steps:

  • Go to the EPFO's Unified Member Portal and select the 'Know Your UAN' status option.
  • You will get three options to retrieve your UAN. You can find UAN with your PF member ID, Aadhaar number, or PAN number. Select any one of these three options.
  • You will be redirected to another page, where you have to enter your personal details such as name, mobile number, date of birth, email id, etc.
  • Once you submit these details, you will receive an authorisation pin on your registered mobile number.
  • Upon entering this pin, your UAN will be sent to your registered mobile number and email id.
Who is eligible for the provident fund?

All employees who earn less than Rs. 15,000 per month are eligible to receive the provident fund. Employees making more than this are not eligible, but it is up to the employer's discretion. All business entities with more than 20 employees are mandated to be members of the EPFO.

How can I withdraw my maximum PF amount?

The Provident Fund amount accumulates during your working life, enabling you to ensure a comfortable retirement. Here's how you can get the maximum PF amount:

  • PF will keep accumulating over time if you choose not to withdraw it throughout your working life. This way, you can be assured of the maximum PF amount used during your retirement.

  • You can withdraw the maximum amount of 90% of the total corpus if you choose to withdraw the corpus 1 year before your retirement.

  • The loss of a job has also been considered in the latest EPF withdrawal rules. According to these rules, 75% of the accumulated EPF corpus can be withdrawn 1 month after leaving the job. The remaining 25% can be withdrawn after 2 months of unemployment.

  • There are other options for partial withdrawal after a minimum of five to seven years of service. Such leaves can be for medical emergencies, house renovation, weddings, and home loan repayment. Each of them has a set of rules to be followed.

However, withdrawal before five years of service will attract tax per your income tax bracket.

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Disclaimer

As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.