KUALA LUMPUR, March 16 — Malaysians will be allowed to make a special withdrawal of RM10,000 from their retirement savings with the Employees Provident Fund (EPF), Prime Minister Datuk Seri Ismail Sabri Yaakob announced today.
Ismail Sabri said the government had heard and studied requests from all who want to make withdrawals from their EPF savings.
“Therefore, today, the government agrees to allow a special EPF withdrawal of RM10,000,” he said in his announcement that was broadcast “live.”
He said EPF and the Finance Ministry will provide further details on this special withdrawal.
In the same announcement, Ismail Sabri noted that the Malaysian government had previously allowed EPF contributors to withdraw from their EPF savings through the three schemes of i-Lestari, i-Sinar and i-Citra, with such withdrawals totalling RM101 billion made by 7.34 million contributors since the Covid-19 pandemic began in Malaysia two years ago.
He said comprehensive studies and findings show that some Malaysians are still affected economically in the post-pandemic recovery phase, noting that some of them lost their income and are still rebuilding their lives.
“This is a difficult decision as it involves the savings for the people 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.
“Although the government allows for this special EPF withdrawal, I plead with all contributors to maintain their savings unless the situation is truly desperate.
“I hope the contributors would make the necessary consideration before making any withdrawals, for the sake of their future,” he concluded.
On December 28 last year, the EPF said the RM101 billion withdrawals by members from 2020 had resulted in 6.1 million of such contributors having less than RM10,000 in their EPF savings, including 3.6 million who have less than RM1,000 in their EPF accounts.
Noting that using EPF savings for emergency needs would severely impact members’ savings for their retirement years, the EPF had also expressed concern as it highlighted RM240,000 as the basic savings threshold or the minimum amount that EPF contributors should have by the age of 55 in order to have a decent retirement.
The EPF had at that time also said any future exceptional withdrawals from EPF savings should be deemed unnecessary given the many forms of government financial aid to individuals and businesses to recover from the Covid-19 pandemic and the floods then.
On March 2, the EPF announced dividend rates of 6.10 per cent for conventional savings and 5.65 per cent dividend for Shariah savings in 2021, with a total payout of RM6.27 billion and RM56.72 billion respectively to its members. These dividend rates were better than the last year.
EPF chairman Tan Sri Ahmad Badri Mohd Zahir had at that time said: “The RM101 billion pandemic-related withdrawals since the year 2020 had resulted in 48 per cent of EPF members having less than RM10,000 in their accounts. We hope that this dividend and our continued performance will help us begin the process of rebuilding our members’ retirement savings, as economic recovery takes shape over the course of the year.”
