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KWSP Malaysia for Monthly Housing Loan Payment

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I heard a lot of forumer keep on discussing about this issue recently – KWSP steal citizen money! KWSP allow monthly withdrawal from EPF account 2 for the monthly housing loan repayment. But, from their discussion, some of them said that the withdrawal plan is actually a SCAM! I am sure you will feel keen to know more on this issue, right? Let me share with you what I’ve heard:

We take an assumption here:

If you have RM50,000 in your EPF account 2 and your monthly housing loan’s installment is RM1000/month. KWSP will approve your application of withdrawal from your EPF account 2 of RM50,000 and pay you RM1000/month for the next 50 months.

The only thing that KWSP did not inform us in detail is that when the application was approved, will the total amount RM50,000 is removed from EPF account 2? In the other words, it appears to be transferred to an unknown account to effect the monthly payment?

After my careful calculation, I found out that there’s huge impact to us if it was true:
You will lost the dividend gain. Let say the KWSP dividend is 5%, then you will lose RM2,500 in dividend during the 1st year. Based on the above example you will lose more than RM10,000 over the 50 months period!

The above is just my rough assumption and I do not have any evidence to show that they will transfer our money to unknown account. Anyway, this is just my personal sharing, do not panic and please keep thinking positive with KWSP Malaysia since a lot of Malaysians these days do not even know how to save, and get themselves into debt before 30. EPF forces us to save 11% of our salary each month and the money will come back to us guaranteed at 55 plus dividend so that we can retire comfortably.

8 Responses to “KWSP Malaysia for Monthly Housing Loan Payment”

  1. Watch Twiglight Saga Eclipse Online Says:

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  2. anaklangkawi Says:

    Well, we must have trust on EPF. If we have doubt just dont widraw monthly then. Select the one time widrawal..



  3. 1-million-dollar-blog.com Says:

    What!. If it is rue then is is better to withdraw the money & pay all of them to reduce the mortgage loan. Then talk to the bank to use that bullet payment as monthly payment.



  4. Adeosk Says:

    Hi David,

    The rumors are totally untrue. The EPF has in fact issued a press statement regarding the issue in October 2008 as attached below. Please forward this to all your cyber friends to clarify the issue.

    EPF PAYS DIVIDENDS FOR SAVINGS RESERVED UNDER HOUSING LOAN MONTHLY INSTALMENT WITHDRAWAL

    The Employees Provident Fund (EPF) would like to state that members’ savings that have been kept aside in a separate account for withdrawals under Housing Loan Monthly Instalment Withdrawal will continue to receive dividends accordingly. This statement comes in response to recent emails and blogs that state the EPF does not pay dividends on the said amount.

    When a member’s application for Housing Loan Monthly Instalment Withdrawal is approved, the total amount of savings that will be taken out from Account 2 for the purpose of this withdrawal will be put aside in another account. The reason for this is to separate the amount from the main account, as funds allocated for this withdrawal cannot be used for other withdrawals from Account 2. In addition, it serves to facilitate as well as monitor the monthly payments.

    The EPF would like to reiterate any savings that are still with the EPF will continue to earn dividends annually up until the member reaches the age of 75. Accordingly, the savings that have been kept aside and are committed for withdrawals under Housing Loan Monthly Instalment Withdrawal will continue to receive dividends for the year. The dividends on this amount will be credited into Account 2 after dividend for the year is declared.

    In any case, the Housing Loan Monthly Instalment Withdrawal was introduced in January 2008 and as dividend for 2008 is yet to be declared, there is no issue of the EPF not paying dividends on the said amount.

    We hope that this statement will put to rest any confusion regarding this issue. The EPF wishes to assure its members that it is committed to protecting members’ interests and enhancing the value of their savings.



  5. marx Says:

    EPF has officially denied that long ago. Check: http://www.kwsp.gov.my/index.php?hdl=bin&rp=900

    Also, check your annual statement to verify if you have been paid the dividend for the part of money transferred into the “unknown” account. Complain to EPF if your dividend amount doesn’t tally to what you deserve.



  6. gawtrez nyeging Says:

    i’ve withdraw every years from EPF account 2 for my housing loan and during that time neither me or others thinking of what your bla bla bla, so….. create blog which more usefull to MANKIND. EPF is individual thing.



  7. chongkonghui Says:

    Good for those who plan and make use the scheme.

    Withdraw from it monthly so I will have more fund for investment account.

    Based on my experience and effort put in, I can generate >8% return, therefore I am better off.

    This method NOT recommended to those not serious enough in investment, i.e. not putting in enough effort.



  8. kubangsamangboy Says:

    I checked T&C of this monthly withdrawal & found that the balance amount in the special account is entitles for yearly dividend calculation. “Amaun yang diasingkan ke Akaun Khas akan dibayar dividen dan dikreditkan ke Akaun 2 sebaik sahaja dividen diisytiharkan pada tahun berikutnya”



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