SHAH ALAM: Most members of the Employees Provident Fund (EPF) below the age of 55 are having an "extremely low" savings of less than RM10,000 in their account.
According to the EPF data, 51.5 per cent or a total of 6.67 million of its members under the age of 55 had savings below the RM10,000 level as of last year.
The number increased by 9.7 per cent or 591,000 compared to the same period in the preceding year.
The EPF chief strategy officer Nurhisham Hussein said the previous withdrawals had provided financial relief to members during the pandemic, but caused their savings to decline and it needed to be rebuilt.
"The majority of members still have low savings. The number of members with savings below RM10,000 is at 51.5 per cent as of the end of 2022. This situation is very worrying.
"We estimated the savings to return to the original level in three to five years," he told Berita Harian in an interview.
According to Nurhisham, the EPF members who had withdrawn their savings during the pandemic were largely made up of Bumiputera at 5.1 million or 76 per cent.
The median savings level for Bumiputera also decreased from RM6,600 at the end of 2021 to RM4,700 in 2022.
The EPF considers a sum of RM240,000 as adequate for a poverty level pension by the time they retire.
"The low amount of savings currently is due to the four rounds of withdrawal related to Covid-19 namely i-Lestari, i-Sinar, i-Citra and a special withdrawal involving a total of RM145 billion.
"It also due to the salary level in this country which is still low even though it has started to increase now following the recovery from the Covid-19 pandemic," he said.
He said the withdrawals were allowed given the situation faced by the EPF members during the pandemic, which was very unusual and had never been experienced before.
On whether it would allow another dip into members' savings, Nurhisham said the EPF would leave it to the government, although he felt that there was no more need for it.
Based on the current situation, there were other methods to help the people, he said.