Proposal to use EPF savings as bank loan collateral not against EPF Act – PM

KUALA LUMPUR: The proosal to allow Employees Provident Fund (EPF) members to use their savings as collateral for bank loans does not breach Section 51 of the EPF Act, said Prime Minister Datuk Seri Anwar Ibrahim.
Anwar, who is also Finance Minister, said the government had checked with EPF and the Attorney-General for legal advice on this matter.
He said this method of applying for bank loans would not jeopardise the interests of EPF members because they would continue receiving dividends on the savings used as collateral.
“For example, RM50,000 is used (as collateral) for loans but dividends will be given in full according to the original amount. So there is no deduction (dividend),” he said during the Minister’s Question Time (MQT) in the Dewan Rakyat today.
He was replying to a supplementary question from Datuk Muslimin Yahaya (PN-Sungai Besar) on whether the proposal would breach the EPF Act and whether the prime minister had sought advice from the Attorney-General on the matter.
— BERNAMA