Everything You Need To Know About Making EPF Withdrawals

By: Fahri Ahmed
18th Apr 2022
Property News

Employment Provident Fund (EPF) announced its latest withdrawal on 16 March 2022. However, the government allowed fund withdrawal three other times before this. This article will talk about the previous EPF withdrawals, how members withdrew those funds and how to receive money using the latest EPF withdrawal.

What is the Employment Provident Fund (EPF)?

Employment Provident Fund (EPF), also known as Kumpulan Wang Simpanan Pekerja (KWSP), provides retirement benefits on a contribution basis to employees in Malaysia. It acts as social security to give pensions to people working in the private sector and non-pensionable posts in the public sector. EPF is also applicable for contractual workers or employees working under an apprenticeship.

What types of Employment Provident Fund (EPF) accounts are there, and what kind of withdrawal do they allow?

Employment Provident Fund (EPF) offers two types of individual accounts. For employees under 55, 70% of their EPF contribution goes to Account 1, which accumulates in their retirement fund. In contrast, the remaining 30% goes to Account 2, which can be accessed before their retirement age.

Account 1 is off-limits until the EPF members are 55 years old, their retirement age. It acts like a fixed deposit account where investors cannot withdraw money until a specific period. In return, they get yearly dividends as an added incentive to their principal amount deposited into the account.

However, EPF members can withdraw funds from Account 2 if they are 50 years old or above for the following purposes other than retirement:

  • Education
  • Hajj
  • Buying a house
  • Certain critical illness
  • Other approved expenses

What type of special withdrawal is allowed under EPF?

While the above are the general circumstances under which members can withdraw funds from EPF, special withdrawals have been allowed since the onset of Covid-19.

The lockdowns during the pandemic have hit the nation severely. Many people lost their job, business, or income source in the last two years. To help the barely surviving community keep afloat from the overflowing expenses, the government allowed special withdrawal from EPF three times before the latest withdrawal announcement on 16 March 2022.

The facilities through which the funds were released were:

  • i-Lestari
  • i-Sinar
  • i-Citra
  1. i-Lestari

    The government announced the first special withdrawal on 23 March 2020 via the i-Lestari facility. Under this facility, EPF members under the age of 55 could withdraw between RM50 to RM500 per month from Account 2. The facility was available from 1 April 2020 to 31 March 2021.

    Who could apply?

    • Malaysian citizens, permanent residents (PRs) and non-Malaysians.
    • Aged 55 years old or below.
    • Have savings in Account 2.

    Though the applicants were allowed to withdraw up to RM500 per month for 12 months, the amount they could withdraw depended on whether they had sufficient money in Account 2.

    If their Account 2 fell short of the withdrawal requested by them per month, the money transferred was based on the available balance they had in their account.

    As for withdrawal duration, if the EPF members applied for the withdrawal on 1 April 2020, the first payment came on 1 May 2020. However, if they applied later, the fund was released from the date the application was approved until the validity of the period, 31 March 2021.

    How did EPF members withdraw money under the i-Lestari facility

    1. Online application via i-Lestari Online through KWSP.
    2. Online application via e-Pengeluaran on Member’s i-Akaun by accessing the official portal, logging into i-Akaun and clicking on the withdrawal section.
    3. Application via email by submitting a form to ilestarimohon@epf.gov.my.
    4. Application by post to the following address: Kumpulan Wang Simpanan Pekerja, Karung Berkunci No 220, Jalan Sultan 46720, Petaling Jaya.
      The application letter needed to be addressed “Attention to: i- Lestari” on the front of the envelope.
    5. Once the application was granted, the money was credited to the member’s bank account on a recurring basis from the time of approval till the end of 31 March 2021.
      The application process was much faster for the first two options as they were made online. However, for non-Malaysians, application by post was the only available option.
  2. i-Sinar

    i-Sinar was an extension of i-Lestari as people were still struggling to meet their daily expenses after the withdrawal under the i-Lestari facility. The government announced the i-Sinar withdrawal scheme during the declaration of Budget 2021, which ran from 21 December 2020 till 30 June 2021.

    At first, the i-Sinar facility was introduced for two groups of people designated under category 1 and category 2. For i-Sinar, the withdrawal allowed was from Account 1, which was previously off-limits to any members until they reached their retirement age.

    However, unlike i-Lestari, any withdrawals made under the i-Sinar facility needed to be 100% reimbursed by the members. Therefore, all their future contributions post the withdrawal would be credited to Account 1 until the advanced amounts are replenished. Then, the contribution would revert back to its normal distribution of 70% to Account 1 and 30% to Account 2.

    Who could apply?

    • Under category 1, members who did not contribute to the Employment Provident Fund (EPF) for two consecutive months were eligible for the i-Sinar facility. This group of people comprised self-employed workers, gig economy servers and workers in the formal sector. Other than that, people who recently lost their job, housewives, and those not allowed any paid leave also fell under this category.
    • Under category 2, members whose total income, including salary and other benefits, declined by 30% from 1 March 2020 were eligible for the withdrawal.

    Members under category 1 were allowed to apply for the withdrawal from 21 December 2020, whereas members under category 2 could apply for the withdrawal from 11 January 2021.

    However, from 11 February onwards, the above i-Sinar eligibility criteria was removed. Under the new criteria, any EPF members under the age of 55 could withdraw funds under this facility.

    How much money could the EPF members withdraw under the i-Sinar facility?

    i-Sinar divided the eligible withdrawal amount into two parts:

    • Members who had equal to or less than RM 100,000 in Account 1 could withdraw a maximum of RM10,000 from their EPF. The payment was staggered over six months, with the first payment up to RM5,000.
    • Members who had more than RM100,000 in Account 1 could withdraw a maximum of 10% from their Account 1 savings or RM60,000, whichever is lower. The payment was staggered over six months, with the first payment up to RM10,000.

    The earliest they could receive money under i-Sinar was at the end of January 2021. Under the new criteria announced in February 2021, the first payment month began on 2 March 2021.

    How did EPF members withdraw money under the i-Sinar facility?

    Members could apply for i-Sinar withdrawal through their official i-Sinar website.

    Once the application was approved, the money received by the members was either credited directly to their bank accounts or withdrawn from any EPF kiosk or counter in the following month. To ensure smooth payment, members needed to:

    • Register to i-Akaun.
    • Update their mobile number for Transaction Authorization Code (TAC).
    • Ensure that their bank account number is active.

    To check their Account 1 balance, they can do it through the EPF app or the i-Akaun portal.

  3. i-Citra

    i-Citra was announced by former Prime Minister Tan Sri Muhyiddin Yassin on 28 June 2021 following the announcement of ‘Pakej Perlindungan Rakyat dan Pemulihan Ekonomi’ (Pemulih). It was the third special withdrawal allowed to help EPF members cope with the economic impact of the pandemic. Members could apply for this facility from 12 July 2021 till 30 September 2021.

    Who could apply?

    • EPF members below or equal to 55 years old.
    • Malaysian citizens, permanent residents (PRs) and non-citizens.
    • Have at least RM150 in their EPF Accounts on the date of approval.
    • Members who applied under i-Lestari and i-Sinar facilities.

    How much money could EPF members withdraw under the i-Citra facility?

    Under i-Citra:

    • The minimum withdrawal amount was RM50.
    • The maximum withdrawal amount was RM5,000.
    • The monthly payments were made up to five months, with the highest amount being RM1,000 per month.
    • EPF first used Account 2 for the withdrawal amount. When their savings in Account 2 fell short, Account 1 was used to pay for the remaining withdrawals.

    Under this scheme, the earliest withdrawal was in August 2021. When their application was approved, the fund was released the following month from the date of approval.

    How did the EPF members withdraw money under the i-Citra facility?

    Members could apply for i-Citra withdrawal through the i-Citra portal. Once the application was approved, the withdrawal amount was directly credited to the member’s bank account, provided they had an active bank account number. Both savings and current accounts were eligible for withdrawal.

    If the members did not have any bank account, they could apply for i-Citra payment via Payment Instruction on the i-Citra Online portal. However, this method took more time to process and members needed to be present at their selected EPF branch to collect the payment instruction.

Special Withdrawal in 2022

In 2022, EPF declared yet another special withdrawal, with the intention that it be the last one, looking at how multiple withdrawals are draining the retirement fund of EPF members dramatically.

This special withdrawal announcement was made on 16 March 2022. The latest withdrawal application started on 1 April 2022 and will run till 30 April 2022.

Click here to know more about EPF dividend declaration and withdrawal allowance for 2022.

Who can apply?

All members under the age of 55 years old are eligible to apply for this special EPF withdrawal.

How much money can the EPF members receive under this special withdrawal?

Under this scheme, the members are allowed to make a single withdrawal from RM50 up to RM10,000. Once the application is approved, the earliest the members can receive the money is 20 April 2022.

To make the withdrawals, EPF will first utilise the savings in Account 2 before accessing the members’ money in Account 1.

How can members withdraw money under this special withdrawal?

First, EPF members need to apply for the latest withdrawal online via pengeluarankhas.kwsp.gov.my, which is also accessible via their i-Akaun mobile application.

Next, EPF will directly credit the withdrawal amount to the member’s savings or current account once the application is approved. For smooth payment, the members must ensure:

  • They have enough EPF balance for the withdrawal via i-Akaun, i-Akaun mobile application or EPF kiosks.
  • The bank account registered under EPF must be in the member’s own name. Shared or business registered accounts are not applicable.
  • The bank account number must be active.
  • To check the application status, members can log in to pengeluarankhas.kwsp.gov.my from 9 April 2022.

For further details on the latest EPF withdrawal, members can go to the EPF website and ‘Ask ELYA.’ They can also contact EPF via FacebookTwitter and Instagram or the Special Withdrawal Hotline at 03-8922 4848 as well as meet member advisory officers at any EPF branches nationwide from 1 April onwards for free advice on their savings or any other queries regarding EPF withdrawals.

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