KUALA LUMPUR, March 21: Employee Provident Fund (EPF) contributors can use the Islamic financing loan method to apply for emergency loans made with their savings as collateral.
Prime Minister Dato Seri Anwar Ibrahim said the Islamic financing loan method would ensure that the service cost would be kept at minimal.
“However, we will not prevent EPF contributors especially the non-Muslims who want to borrow through the conventional loan method,” he said during the Prime Minister’s Question Time in the Dewan Rakyat broadcast by Parlimen Malaysia’s YouTube livestream today.
He also stressed that the proposal to allow EPF savings to be used as collateral for emergency bank loans does not breach Section 51 of the EPF Act.
He said the government has checked with EPF and the Attorney General for legal advice on the matter.
“This would not jeopardise the interests of EPF members because they would continue receiving dividends despite their savings being used as collateral.
“For example, RM50,000 is used as collateral for loans but the dividend will be given in full according to the original amount. So there is no deduction on dividend,” he added. — DayakDaily
