KUALA LUMPUR: The Employees Provident Fund yesterday explained that the pension-fund like approach of a monthly drawdown ,still under works, is for a portion of member's savings, up to a certain limit, to be converted into a monthly income.
The remaining portion can be withdrawn lump-sum.
EPF said this is needed to prevent old-age poverty and for consumption smoothing during retirement.
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The process of formalising the proposed monthly withdrawal mechanism is still being studied and will take into account the ability and readiness of members to make such transition.
The EPF has been encouraging members to voluntarily shift to regular monthly payout rather than lump-sum withdrawals.
In 2022, more than 7,000 members have already voluntarily adopted the monthly payout option.