The Latest EPF Special Withdrawal Is Out: Should You Take It?

By: Fahri Ahmed
16th Apr 2022
Property News

On 16 March 2022, the government declared the Employment Provident Fund (EPF) special withdrawal for the fourth time since the pandemic. It is intended to cater to the financial needs of people still impacted by Covid-19. Prime Minister Datuk Seri Ismail Sabri Yaakob sees the withdrawal as a middle ground for people to balance their current emergency and future savings.

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

How did EPF members respond to the first day of the special withdrawal going live?

The application for the special withdrawal started on 1 April 2022 and continues till 30 April 2022. Being the first day of application, a crowd of people queued in front of the EPF headquarters on Jalan Raja Laut in Kuala Lumpur as early as 8 am in the morning.

Fazleena Aziz from Star Online was present at the venue. She could see people’s excitement as they were allowed yet another special withdrawal from EPF.

When asked what they would do with the money, Dania Shafikah, a packaging operator, said she would use the funds to celebrate Hari Raya Aidilfitri with her children.

Syed Arif Fakhrul, a customer service operator, says he has been struggling to keep up with expenses since he lost his job at a hotel during the pandemic. The money would help him ease his burden and pay for his wedding nuptials.

So far, the government has only announced that the EPF amount allowed would be a single withdrawal up to a maximum of RM10,000. But the details of the withdrawal process have been released only recently.

Who is eligible to make the special EPF withdrawal?

  • Malaysians, permanent residents (PRs) and non-citizens.
  • Members under the age of 55 years old.
  • Have at least RM150 in their EPF account at the time of the application.

How much can EPF members get from this special withdrawal?

EPF members can make a single withdrawal, with the minimum being RM50 and the maximum being RM10,000. They can apply anytime in April 2022. If their application is approved, the money will be transferred starting from 20 April 2022.

This special withdrawal has strings attached. After making the withdrawal, members will be subject to a 20% reimbursement of the withdrawn amount. The monthly EPF contribution will not increase. Instead, the percentage of subsequent EPF contributions will be prioritised to Account 1 until 20% of the amount withdrawn is replenished.

Which account will cater for this special withdrawal?

EPF will disburse the money from Account 2 before accessing Account 1’s savings. However, the members must have at least RM 100 in Account 1 after they make the withdrawal to maintain their status as active EPF members.

How will EPF members withdraw the money under this special allowance?

First, members need to check their latest EPF balance to ensure they have sufficient money to withdraw from their accounts.

To check their EPF balance, they need to:

  • Login to EPF i-Account.
  • The i-Account can be accessed via the official website, mobile app or EPF Kiosks.
  • Go to the Account menu.
  • Click ‘Current Year/ Previous Year Statement.’
  • Click ‘View details’ to check the current balance.

Next, if they have the desired amount they want to withdraw from EPF, they must apply online via KWSP’s official portal. If their application is approved, they can withdraw the money through i-Account, considering they have an active bank account. To ensure smooth payment, they are advised to update their phone number for the Transaction Authorization Code (TAC) needed to verify the transfer.

Click here to know more about making EPF withdrawal.

What did EPF members do with their previous withdrawal?

The nation is debating whether it is wise to release such significant EPF amounts so frequently. In the past two years, the government released RM101 billion to 7.34 million contributors through the i-Lestari, i-Sinar and i-Citra facilities. It is crucial to ensure that the public puts the money to good use.

Click here to know all about EPF and past withdrawals under i-Lestari, i-Sinar and i-Citra.

Last year, when people were applying for the i-Sinar facility, USCI Research Centre took a survey involving 809 respondents across the country.

According to their findings,

  • 34.9% of the respondents withdrew i-Sinar money for investment purposes.
  • 55% used the money to pay monthly insurance.
  • 48.6% used the withdrawal for kitchen appliances and food.
  • 32% used it for home renovations.
  • 24.1% used it to buy gadgets.
  • 18.4% used it for savings in their bank account.
  • A large portion of B40 and M40 groups between the age of 26 and 55 also used the money to repay their debts.

That being said, the people are falling short of funds even after EPF withdrawal had been allowed three times prior to the latest one.

What justifies making the latest special withdrawal by EPF members?

With the ongoing debate of whether one should withdraw their EPF money or not, four Malaysian finance bloggers weighed in on the discussion.

KC Lau from says it is only justified to withdraw the RM10,000 if the members can invest the money in a higher interest financial instrument. However, this would need them to have a good knowledge of investment.

Suraya Zainudin of Ringgit Oh Ringgit says it is best if the members don’t gamble away all RM10,000 on investment. Instead, people can invest a portion of the money while stashing the rest elsewhere.

Aaron Tang of Mr-Stingy advises people to maintain extreme caution while utilising the money. Over the past 50 years, EPF has returned between 4.25% to 8.50% per annum. So if people can invest in stocks, mutual funds, or crypto that can confidently give them consistent returns above 6.1% year after year, only then they should take out the money for investment.

People are also discouraged from using the fund to buy a new home or taking up a new loan. Therefore, it is only justified to use the money to repay debts if it helps people reduce their high-interest loans to lower their compound interest.

Now, many people are withdrawing money for their emergency reserve or helping out a family member in dire need. The finance bloggers advise that people first seek help from family members, insurance policies or SSPN contributions. Only after they have exhausted every available option can they consider making the special EPF withdrawal as it is their last resort.

For further questions on the latest EPF withdrawal, people can refer to EPF’s official website or use the ELYA chatbot. They can also contact EPF via Facebook, Twitter and Instagram, or call them at 03-89224848 to seek advice on their EPF savings and more.

Browse other news