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PM Anwar: EPF savings as collateral for emergency loans won’t involve withdrawals

Malay Mail
Malay Mail

IPOH, March 11 — Prime Minister Datuk Seri Anwar Ibrahim today clarified that the plan to allow Employees’ Provident Fund (KWSP) contributors to use their savings as collateral for loans would not involve any withdrawals from their savings.

Anwar reiterated that the plan would only apply to those who are in dire straits.

“We won’t allow (withdrawals). This is no longer Covid-19 (pandemic). People are back to work.

“But there are one or two desperate cases, where they have savings in their EPF accounts but can’t pay for their children’s education abroad.

“So this is for such cases, but we don’t allow them to withdraw from their EPF savings and there are fixed regulations,” he told reporters after officiating World Water Day 2023 celebrations at Stadium Indera Mulia here.

When asked whether the savings used as collateral would contravene the EPF Act, Anwar said, “No”, and added the matter had been discussed with EPF already.

“If you ask me personally, I wouldn’t want that too, but there are specific cases with valid reasons. There is one case with savings of RM1 million, but desperate (for fund). So we need to consider for such cases,” he said.

On Thursday, Anwar, who is also the finance minister, announced that the government is deliberating to greenlight the use of EPF savings as collateral for emergency loans, following repeated calls from the Opposition to allow further withdrawals.

In his winding-up speech for the policy stage of Budget 2023, Anwar pointed out that this would only apply to those who are really struggling with their financial circumstances.

Anwar also stressed that it was unfair to make Malaysians keep dipping into their retirement savings when these have already been drawn down repeatedly during the Covid-19 pandemic, saying the government would instead look for alternatives to help.