The Employees' Provident Fund (EPF) has just launched the EPF Account Restructuring which will take effect on May 12, 2024 in order to improve the security of retirement income while meeting the life cycle needs of members.
It is also a government initiative to help a group of consumers who are desperate to use their savings for a specific purpose.
Now, member accounts will be restructured from the previous two accounts to three accounts.
Account 1 (Retirement): 75% of income deductions are saved for retirement.
Account 2 (Prosperity): 15% of income deductions to address daily cycle needs to well-being in retirement.
Account 3 (Flexible): 10% of income deduction as a flexible provision for short-term financial needs. Members can remove it at any time as needed.
According to information on the EPF i-Akaun application, members who want to withdraw savings exceeding RM250 need to go through the electronic Know-Your-Customer (e-KYC) process online or use other alternatives such as visiting the nearest EPF office for fingerprint verification.
The e-KYC process or identity verification done electronically requires facial recognition in the KWSP i-Akaun application.
In addition, contributors can transfer money to a bank account once a day with a minimum rate of RM50.
According to the EPF statement, applications for withdrawals from Flexible Accounts can be made through the application or at any branch nationwide.
The balance in Account 1 and Account 2 will remain in the Retirement Account and Sejahtera Account respectively. Whereas, Flexible Account will start with zero balance.
