EPF: Withdraw from Account 2 first with i-Citra

Moving forward, EPF CEO weighs a little bit heavier to investing in the Shariah segment

by NUR HANANI AZMAN / pic by TMR FILE 

THE Employees Provident Fund’s (EPF) latest withdrawal facility, i-Citra, is designed to help its members tide over the impact of the Movement Control Order (MCO) by withdrawing from their Account 2 first.

EPF CEO Datuk Seri Amir Hamzah Azizan said members can access Account 2 for housing, medical and education.

“That is where you draw your money first.

“With i-Citra, the first drawdown will come from all your access availability in Account 2. If this is inadequate, then only we allow you to access Account 1.

“We are finding a balance between helping people and making sure that they also have adequate savings for retirement,” he said in a virtual “MIDF Conversations” session with Malaysian Industrial Development Finance Bhd (MIDF) group MD Datuk Charon Wardini Mokhzani yesterday.

The i-Citra withdrawal facility that will open for application from July 15 is a continuation of the previous EPF withdrawal initiatives, i-Lestari and i-Sinar.

EPF members can apply on the i-Citra online portal icitra.kwsp.gov.my with the first payment expected to be credited in their respective accounts next month. All members under 55 years old can apply for i-Citra, with a maximum withdrawal of RM5,000 subject to their total combined balance in both Accounts 1 and 2.

During the i-Sinar and i-Lestari initiatives, Amir Hamzah said a total of RM80 billion had been paid out.

“We are here to help people after their retirement, but we also understand that the Covid-19 pandemic is an unusual circumstance. We are finding a way to give people, within reason, access to their funds.

“The key here is making sure that EPF does not lose the mandate of helping people with their retirement savings.

“If we allow total savings to drain out, which is now already a problem, it will become an unmanageable issue. That is the balancing act that EPF has to do,” he added.

Moving forward, Amir Hamzah said he weighed a little bit heavier to investing in the Shariah segment.

“We are about 40% in Shariah and the balance is conventional. But that cannot be the perception that Shariah will give you a low return.

“The fundamental issue is not that Shariah drives you to low return. It is what the entity below is doing that actually drives the return.”

Amir Hamzah said EPF picks the right element of Shariah to invest in, so the yield picks up.

“A big chunk of our portfolio is fixed income and domestic-based, while the Shariah segment is very big, one of the key promoters for Islamic financing for the year,” he said.

On overseas investment, Amir Hamzah said the group is looking at what the market offers and EPF’s capability in balancing the risk.

“We will shift depending where the market moves over the years. The key is to be very measured in our approaches.

“We do not jump everywhere. Our approaches are very targeted and clear, so we can always anchor the decision better.”