By MARK RAO
The Private Retirement Schemes (PRS) in Malaysia has seen its highest-ever membership in 2018, with members growing by 38% amid domestic and international economic challenges last year.
The PRS — managed by Private Pension Administrator Malaysia (PPA) — saw saving schemes membership grew to 416,913 last year, up 38% from 301,279 members in 2017.
Total net asset value of the funds also rose by 20% to RM2.66 billion over the same period.
PPA CEO Husaini Hussin (picture) said the scheme managed to sustain growth momentum in spite of 2018’s challenging environment.
“This means that more people are aware that PRS is a long-term savings scheme and are less worried about short-term market volatility,” he said in a statement yesterday.
He added that the larger PRS membership base indicates that more young adults are taking retirement planning seriously as close to 40% of membership are aged 30 and below.
“The youth incentive has ended, but the drive to continue encouraging the youth to save for their future remains,” he said.
This will entail social media and community outreach programmes, collaboration with public and private universities to improve financial literacy and working with the industry to make retirement schemes affordable.
For 2019, PRS is expected to grow by a similar trajectory aided by various initiatives, including digital strategies, financial literacy programmes and corporate participation, Husaini said.
He added that this can be achieved via concerted efforts by PPA, all PRS providers and distributors and the Securities Commission Malaysia acting as the regulator.
Meanwhile, PPA intends to introduce more value-added services and digital initiatives to PRS members, following up on the PRS Online Enrolment platform.
PPA will also be pushing corporate Malaysians to make retirement planning and financial wellbeing an essential component of workplace policy.
This includes employers contributing to the employees’ PRS accounts, facilitating bulk enrollments at workplaces and encouraging PRS contribution via salary deduction.