After bringing in portability, in 2016, EPF also decided that an employee would not be able to withdraw contributions of the employer till she turned 58. But this caused other problems. The rule would make it difficult for someone quitting formal workforce to withdraw the entire money, and worse, after 3 years the account would become inoperative with no further interest paid.

There was strong pushback against this rule and ultimately the EPFO never implemented this rule. Further, in an order in November 2016, it decided to pay interest even on inoperative accounts.

According to V.P. Joy, Central Provident Fund Commissioner, the inoperative accounts will earn interest till retirement only. Also, if a person retires and does not withdraw the money, then after 3 years the account will become inoperative and no interest will be paid in this case.

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