Putrajaya mulls allowing use of EPF retirement fund as collateral for emergency loans

Malay Mail
Malay Mail

KUALA LUMPUR, March 9 — The government said today it is deliberating to greenlight Employees’ Provident Fund (EPF) savings to be used 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, Prime Minister Datuk Seri Anwar Ibrahim said this, however, will only apply to those who are really struggling with their financial circumstances.

“I welcome the opinions, but we must remember that EPF is meant as retirement savings. We gave leeway during the Covid-19 pandemic, but other countries that did it have also stopped this.

“Instead, I suggest another method to assist those who desperately need cash. I will make sure that EPF will provide space to allow contributors with enough savings who are in dire straits to borrow from the bank, with their savings used as collateral. This is the best,” Anwar, who is also finance minister, said in Parliament today.

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.

“Do we realise that the EPF savings are so important that, even if someone is declared bankrupt, the creditors cannot take the EPF savings because there is an Act that protects them?

“So far, in Budget 2023, we have done our best to help the people and reduce the burden of living costs. It’s not that we don’t do anything,” he added.

Anwar’s Budget 2023 sailed through the policy stage via a voice vote at the Dewan Rakyat today.

Parliament Speaker Datuk Seri Johari Abdul called the vote on the Supply Bill 2023 after a winding-up speech from Anwar, who is also the finance minister.