RM6.98bil withdrawn from EPF Account 3 to date, says Finance Ministry

KUALA LUMPUR: A total of RM6.98bil has been withdrawn to date from the Employees Provident Fund (EPF) Account 3 (Flexible Account) by members below 55, the Dewan Rakyat was told.

The Finance Ministry said in a parliamentary written reply that the sum involved 2.93 million or 22.6% of EPF members below 55, at an average withdrawal of RM2,382.

It also said that as of June 10, a total of RM10.86bil had been transferred as an initial amount into the flexible account of 3.45 million members.

“Members can opt to have the initial amount by transferring a portion of their savings in Account Sejahtera (Account 2) to the Flexible Account (Account 3) from May 12 to Aug 31,” the ministry said in response to Sim Tze Tzin (PH- Bayan Baru).

Sim had asked the ministry to state the total percentage of EPF members who have made transfers to Account 3, the total amount withdrawn and the impact of the withdrawal.

“The restructuring of EPF accounts was not seen to significantly affect the financial position of EPF as the fund has reallocated sufficient cash balance to (meet) withdrawal demand through the Flexible Account,” the ministry said.

It added that the restructuring of EPF accounts was carried out to ensure sustainable financial well-being during retirement while balancing the current needs of its members.

“The initiative aims to help increase retirement savings to allow members to have sufficient retirement income.

“With this initiative, the government strives to ensure that every EPF member can confidently and resiliently manage finances in the dynamic and challenging environment today.”

Under a restructuring plan that took effect on May 11, EPF accounts are split from two to three for members aged below 55.

Account 3 gives them access to funds for short-term financial needs.

With the restructuring of accounts, the monthly contribution of members would be channelled to Accounts 1, 2 and 3 in the proportion of 75%, 15% and 10% respectively.