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KWSP Is Giving Lesser Conventional Dividends Compared To Previous Year
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KWSP Is Giving Lesser Conventional Dividends Compared To Previous Year

Total dividend payment for 2022 amounted to RM51.14 billion.

Fernando Fong
by
March 4, 2023

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The Employees Provident Fund (KWSP) announced a dividend distribution of 5.35 per cent for Conventional Savings and 4.75 per cent for Shariah Savings for 2022.

The dividend rate is lower than in 2021, where the dividend for Conventional Savings is 6.10 per cent and 5.65 per cent for Shariah Savings.

The rate is also the lowest since 2020 for Conventional Savings (5.20 per cent) and the lowest for Shariah Savings since the scheme was first introduced in 2017.

Its Chief Executive Officer, Datuk Seri Amir Hamzah Azizan, announced the dividend at today’s (4 March) KWSP financial performance briefing.

Amir Hamzah said the total payment for the entire dividend for 2022 was as much as RM51.14 billion to 15 million members.

Conventional Savings amounted to RM45.44 billion, while Syariah Savings amounted to RM5.7 billion.

He informed that, as of 31 December 2022, the EPF recorded a lower total gross investment income of RM55.33 billion, compared to RM68.89 billion in 2021, driven by market uncertainty and weaker equity and fixed income market valuations.

In 2022, the EPF recorded a gross investment income of RM55.33 billion, with RM6.83 billion allocated to Simpanan Shariah.

Regarding member registration in 2022, Amir Hamzah informed that the EPF registered a growth of 635,989 new member registrations, bringing the total number of EPF members to 15.72 million as of December 2022.

Of that number, 8.39 million are active members, representing 50 per cent of the 16.7 million Malaysian labour force at the end of 2022.

Money No Enough

Meanwhile, netizens continue to rant on social media, demanding that the government allow them to make special withdrawals from their KWSP account.

It started in 2020 with the i-Lestari and i-Sinar schemes 2020 and i-Citra in July 2021.

They were part of economic stimulus measures to help Malaysians affected by the COVID-19 pandemic.

In April 2022, KWSP members were once more allowed to take up to RM10,000 from their KWSP savings.

Instead of agreeing to another special withdrawal, the government adds RM500 to KWSP Savings Account 1 for members aged between 40 to 54 years with KWSP savings of less than RM10,000 in their Account 1.

READ MORE: 2023 Budget: No EPF Withdrawals But Government To Add RM500 To Members’ Savings

Just How Good Is KWSP?

KWSP was established to provide retirement benefits to private-sector employees in Malaysia.

As a savings fund, its primary objective is not to generate profits but to provide a secure and reliable source of retirement savings for its members.

However, the KWSP does invest its members’ savings in various financial instruments, such as equities, bonds, and other assets, to generate returns on these investments.

As of 2021, the KWSP reported a gross investment income of RM61.25 billion, representing a gross income of 5.2% for the year.

It is worth noting that the KWSP’s returns can vary depending on market conditions and the performance of its investments.

The KWSP’s returns are not guaranteed, and risk is always associated with any investment.

Overall, while the KWSP is not a for-profit organization.

It aims to generate a reasonable return on its investments to provide its members with a secure and reliable source of retirement savings.

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