Prime Minister Allows RM10,000 Special EPF Withdrawal
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Prime Minister Datuk Seri Ismail Sabri Yaakob just announced that Malaysians would be able to make a special withdrawal of RM10,000 from their Employees Provident Fund (EPF) retirement savings accounts.
He stated the government had listened and considered requests by those who wanted to make withdrawals from their EPF savings.
"Therefore, today, the government agrees to allow a special EPF withdrawal of RM10,000," the prime minister said in his statement that was broadcast "live."
According to him, the Finance Ministry and EPF would provide more details on this special withdrawal.
Considering the needs of the many
Ismail Sabri also noted in his announcement that the Malaysian government had earlier allowed EPF members to withdraw from their EPF savings accounts via the three schemes of i-Lestari, i-Sinar, and i-Citra. These withdrawals totalled RM101 billion made by 7.34 EPF contributors since the Covid-19 pandemic started in this country two years ago.
He stated comprehensive research and findings show that some citizens are still impacted economically in the post-pandemic recovery phase. He added that some Malaysians who lost their source of income are still rebuilding their lives.
"This is a challenging decision as it concerns the savings for those when they are old, and this special withdrawal is a middle path in balancing between the desperate needs of today and the savings for the future.
"Even though the government allows for this special EPF withdrawal, I plead with all contributors to keep their savings unless the situation is truly desperate.
"I hope the contributors would be careful in their consideration before making any withdrawals for the sake of their future," he stated.
The effects of EPF's withdrawal schemes
On December 28 2021, the EPF stated the RM101 billion withdrawals by members from 2020 had caused 6.1 million of the contributors to have less than RM10,000 in their EPF savings. There were 3.6 million contributors who also had less than RM1,000 in their EPF accounts.
Remarking that using EPF savings for emergency needs would harshly affect contributors' savings for their retirement years, the EPF also voiced concern. It highlighted RM240,000 as the basic savings threshold or the lowest amount that EPF members should have by the age of 55 to enjoy a decent retirement.
At the time, the EPF also said that any future special withdrawals from EPF savings should be seen as unnecessary due to the many forms of government financial aid to the people and businesses to recover from the pandemic and the floods then.
On March 2, EPF announced dividend rates of 6.10% for conventional savings and 5.65% for Shariah savings in 2021. These dividend rates were an improvement compared to 2021. The total payout is RM6.27 billion for conventional savings and RM56.72 billion for Shariah savings.
EPF chairman Tan Sri Ahmad Badri Mohd Zahir at the time stated that the RM101 billion pandemic-related withdrawals since 2020 had caused 48% of EPF contributors to have less than RM10,000 in their accounts. He added that EPF hoped the diving and its continued performance would help in starting the process of rebuilding its members' retirement savings, as the economic recovery takes shape for the year.
Source: Malay Mail