The People Needing EPF Withdrawals

For most people, life is back to normal with the worst of the pandemic over, but for some the nightmare continues as debts pile up. And if you earned RM8,000 a month as a security, safety and health manager but was retrenched with Covid-19  with no job since, life is difficult. If prospect of full-time employment is dim, withdrawal from Account 1will first be used to settle overdue debts. 

The PM has proposed the use of EPF Account 2 to support bank loans as an alternative, a scheme known as FSA2. Many may not qualify FSA2. Why?

You need to have a monthly income. Second, you need to have more than RM3,000 in account 2. And lastly, those whose applications are approved need to make monthly payments. Without regular income this is impossible.

Source: https://ms.wikipedia.org

Whether it is Parameswaran, Mohd Ramli or Tan Tse Chong, they are in dire straits to survive. It is easy for civil servants to hatch “FSA 2” which is fine for some individuals. But what about the rest? EPF needs to be proactive and call-in those with low savings in Account 1 or 2 and establish case credentials.

We don’t have the staff to do this? Engage or outsource this service and validate before approving a new facility or allowing withdrawals. The other way is to create a loan scheme from those EPF members with RM0.5 million or more to lend to other EPF members who are in dire need. This is a voluntary scheme guaranteed by the Government. Consent is sought from those willing to lend on a short-term basis. This is a member-help-member scheme. Your principal or interest is not at risk if guaranteed by the Government. And we don’t need the banks or BNM. The only catch is to re-examine EPF’s charter, if this is feasible. 

Shouldn’t the PM’s advisory committee examine new and interesting ways to assist the poor, destitute and marginalised?

Reference:

Neither young nor jobless: the people needing EPF withdrawals, Sheridan Mahavera, FMT, 15 April 2023