What is EPF i-Saraan? With 15% Incentive?

Last year, EPF introduced a scheme called Caruman Sukarela Insentif Persaraan (i-Saraan), designed to allow individuals with irregular monthly income or who are self-employed to save for their retirement while enjoying the same benefits as EPF members.

Why is i-Saraan Important in Malaysia?

Recently, the EPF revealed that out of Malaysia’s 22 million working-age population, 62% were self-employed, outside the formal labour force and not covered by any form of social protection. More and more people became freelancers, Grab drivers, commission-receiving agents, online business entrepreneurs nowadays...

So, this scheme definitely is a very good initiative by the Government to ensure that this group of people is able to achieve a certain level of savings upon reaching the retirement age. Forced saving is the best way to save up, but this was largely been neglected by this group of people all this. It could become a social problem in the future!

With this, hopefully, it could reduce the number of senior citizens who are reliant on program allocations by the Society Welfare Department

What?

15% Government Incentive?

Am I eligible to get it?

ELIGIBILITY CRITERIA

a) Malaysian Citizen;

b) ‘Self-employed Persons' refer to individuals who derive income from their work and are not an employee;

c) Registered as an EPF member; and

d) Has opted to contribute under the i-Saraan by submitting Form KWSP 16G(1M) click here to download form to nearest KWSP office. Alternatively, you can get the form for free over-the-counter.

How to Make a Contribution?

• Submit Form KWSP 6A(2) with cash/cheque at the EPF counter/mail or appointed bank agent counter such as RHB, MBB, PBB and BSN, or
• Online Banking: Maybank and Public Bank (this is the preferred method)

Payment Limit:

   1. No Minimum amount (only in Ringgit); and

   2. Maximum of RM60,000 yearly only

Special Government Incentive

Members who save under the scheme shall receive Government contribution of 15% on the amount contributed, subject to a maximum of RM250 a year (New rate effective 1 January 2018). The Government contribution has been extended until 2022. And, this is only applicable to members who are under age 55.

The EPF will routinely make Government contribution claims based on accumulated contribution for the first (January to June) and second (July to December) halves of the year. Upon receiving the contribution payment from the Government, the amount will be credited into members' Akaun 1 (Retirement Account).

<<< Update under Budget 2023 >>>

Matching Contribution Incentive (i-Saraan)

The Government has announced in extending the i-Saraan programme for 2023 and increasing the maximum limit of the matching contribution incentive for 2023 from RM250 to RM300 per year. This initiative will benefit members (below age 60) under i-Saraan who are outside the formal sector, including housewives, and help accelerate their financial security for retirement.

<<< Update under Budget 2024 >>>

Matching Contribution Incentive (i-Saraan)

The Government to extend the i-Saraan programme beyond 2023 and increase the annual maximum incentive limit from RM300 to RM500 per year.

Additionally, the i-Saraan programme has also been enhanced where eligible Malaysians in the informal sector, including housewives and those with no fixed income, under the age of 60 years old will have the opportunity to receive a lifetime incentive of RM5,000 per individual, with a capping of RM500 per year.

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