i-Sinar scheme

In the year of 2020 many people are affected by the corona virus and impacted their lives negatively. The whole country are experiencing politics and economic problems due to the lockdowns and the conditional movement control order CMCO. A lot of shops were forced to closed, business cannot run as usual, people lost their jobs, their contract terminated, and many more problems related to economy. Unemployment rate during this year increases as the number of cases keeps on spreading and spiking day by day. People are looking a glimmer of hope that shine through this difficult time.

i-Sinar is a scheme announced by the Employees Provident Fund (EPF) which will help the eligible members to take an advance from their Account 1. According to the EPF chief executive officer Tunku Alizakri Alias, this scheme envisioned to help two million members in this country. This benefit has opened for application since December and once the applications are received and approved, it will be credited in January into the eligible members’ bank accounts. This is not a withdrawal, but an advance. This means the eligible members need to re-fill their bank account with the amount that they have withdrawn.

Furthermore, the prudent fund claimed that this facility will only available to active members that have no other source of income, experienced job loss, or on a no-pay leave recently. "This facility has allowed us to assist those in need of assistance, as well as work with our mandate — to safeguard members' future retirement savings," said Alizakri during a media conference.

To put it simply, members that are eligible for this facility will get to access up to 10% of savings in their Account 1. Also, they are required to put back the full amount advanced until the advanced amount is replenished. "There is no timeline for members to replenish their accounts. This will only start when the affected member gets reemployed or when their businesses start picking up again," Alizakri added.

Although this sounds helpful and beneficial, it does not mean that the members can use the money for fun and personal enjoyment. Those who chose to utilise this facility will have to forgo their compounded returns when they take an advance on their account. Besides, those who is not eligible for it will also be impacted in their dividend payouts because RM11 billion to RM15 billion allocated for this will reduce the amount of money that EPF has for investment in the future.

This initiative will contribute and assist other assistance programmes provided by the government as well as other EPF reassurance – reduction of employee statutory contribution rate, i-lestari withdrawal, and the employer covid-19 assistance programme. Although, EPF advised and encouraged the eligible members to get financial advice from Retirement Advisory Services or the Credit Counselling and Debt Management Agency to decide the suitable amount to be applied under this scheme to secure the feasibility during this difficult times.