Employees Provident Fund Research Articles

The Determinants among Muslim Contributors to Adopt Shariah Funds Decision: Evidence of Employees Provident Fund

Malaysia is one of the world's Islamic financial centres and it is working hard to enhance Shariah governance in the Islamic financial sectors. Shariah Savings introduced on 8th August 2016 is an initiative by the Employee Provident Fund (EPF) allowing investors to determine whether or not their funds should be handled and invested according to Shariah principles. Despite the effort by the Employee Provident Fund (EPF) to promote investment in the Sharia Compliant saving, the Muslim of EPF members' is still low. Hence, increasing EPF Muslim members' investment is a major challenge. Thus, this study aimed to fulfil this gap by examining the Planned Behaviour Theory with additional variables (religiosity, investment knowledge, and risk propensity) mediated by awareness towards investment decisions among EPF Muslim contributors in Malaysia. Questionnaire surveys were utilized in a quantitative research strategy to collect data. Using purposive sampling procedures, data was collected from 295 Muslim members who stick with EPF conventional savings and analyze by using the Partial Least Square Structural Equation Modelling (PLS-SEM)

Examining i-Sinar and i-Lestari Withdrawals Among Employees Provident Fund (EPF) Members During COVID-19 Crisis

To cope with the economic hardship induced by the COVID-19 pandemic, the government has allowed for withdrawals from the Employees Provident Fund (EPF) retirement savings account. This paper explored the impact of COVID19 on the employment and income status of EPF members prompted them to make early withdrawals from their retirement savings through the i-Sinar and i-Lestari schemes as well as usage of withdrawals. The nonprobability convenience sampling technique, specifically the snowball technique managed to capture 2,061 respondents via an online survey. Logistic regression revealed younger respondents, those earning a lower income, and those experiencing income reduction were more likely to utilise both schemes compared to their counterparts. Although most withdrawals were put to good use, it raises concern as the early withdrawals can bring negative consequences to individuals, taxpayers, and the government in future. Findings from this study can serve as a useful input in suggesting some improvements towards the EPF retirement savings scheme.

Financial and Pension Literacy and Retirement Preparedness in Sri Lanka: Evidence from Employee Provident Fund Contributors

Sri Lanka has a rapidly aging population in South Asia, but little attention is given to financial preparedness for retirement. This study expects to provide an overview of the current retirement system in Sri Lanka and investigate financial and pension literacy's role in retirement preparedness. This study administered an online survey to study retirement preparedness subjectively (n = 142) and objectively (n = 115) among the EPF contributors. This non-experimental study uses an online survey to assess financial and pension literacy's roles in retirement preparedness. This study used ordered logistic (Ologit) regressions and ordinary least squares (OLS) regressions to test the two hypotheses. Results indicate a positive and statistically significant association between financial (only objective measure) and pension literacy and retirement preparedness. However, another study shows no synergy effect between financial and pension literacy. Conclusively, drawing policymakers' attention to diversifying EPF investments, including financial and pension literacy concepts in workplace workshops and studying pension literacy and retirement preparedness in different samples.

Making Sense of Anything thru Analytics: Employees Provident Fund (EPF)

Employees Provident Fund (EPF) has always been a hot topic, from the previous Government permitted “withdrawals” during the pandemic to the present Government disallowing further withdrawals (afraid it would lead to a financial crisis) and allowing emergency loans through an EPF collateral agreement. The latter used median studies to “contribute” MYR 500 to EPF members with less than RM 10,000 in their accounts. Baffled/bewildered by the current Government’s generosity and highlighted in this paper, I used Monte Carlo simulation, a method used by analysts when determining the size of a client’s portfolio to support their desired retirement lifestyle, to establish a reference-type table displaying ideal savings when reaching 50. The Government could use the table mentioned above to give more meaningful contributions to EPF members, apart from EPF active and inactive members, knowing where they stand concerning their current EPF savings.

A Study on The Factors Impacting Retirement Planning Among Low-Income Workers in The Northern Region, Malaysia


 Since the world's ageing population is expanding quickly, retirement planning has been identified as one of the top concerns of all nations. As a developing country, Malaysia has also been touched by this issue. Particularly, retirement planning among low income earners is frequently contested because of a lack of available financial resources among them. Therefore, this study aims to investigates the factors influencing the retirement planning among low income workers at the Northern Region, Malaysia. This study anticipated that saving attitude, financial socialisation, financial literacy, and demographic characteristics could all have an impact on retirement planning. A quantitative method with convenience sampling was applied in this study. This study used an online questionnaire to collect primary data from working adults with limited financial resources. Using SPSS, the data that was gathered was examined. Multiple linear regression and Pearson Correlation Analysis were both used in the analysis. The findings demonstrate that ethnicity and state, as well as financial socialisation, saving attitudes, and financial literacy, have a substantial impact on retirement planning among low-income employees in Malaysia's Northern Region. This study will give researchers, policymakers, governments, and Employee Provident Fund a detailed picture of retirement planning among low-income workers in Malaysia's Northern Region (EPF). 

Analysis Towards the Factor of Inadequacy Retirement Fund Among EPF Members

Aging population has become a global phenomenon. Having a long life is great, but it could turn into a nightmare if not prepared properly, especially for retirement savings. In fact, majority retirees in Malaysia had relied on mandatory retirement scheme organized by Employees Provident Fund (EPF), meanwhile, the funds were estimated to deplete just within 5 years after being given to the retirees. Alternatively, the EPF had provided one of the largest and oldest retirement savings funds in the world. Nevertheless, the retirement funds are still insufficient to cover the monthly payments according to the projected life expectancy of a human being in Malaysia, until 75 years old. Thus, this research aims to examine the analysis towards the factor of inadequacy retirement fund among EPF members. Using content analysis, this research examined the appropriate factors to be considered as the addressed problem. The research found that the retirement planning, financial literacy, money management, unexpected cost of living and social norm during before retirement would be deemed as anchor factors to the highlighted issues. Thus, it is valuable if the future study can focus on those factors in investigating the issues.

Islamic Right for Women to Claim their Husband’s EPF Contribution according to Maqasid Sharia

A wife has the right to claim the property jointly acquired (harta sepencarian) during the marriage period. Claims can be made during the marriage (polygamy), divorce, after death or apostasy. Among the property that is often claimed as property jointly acquired is the Employees' Provident Fund (EPF) contribution money, although the claim is often rejected by the Shariah Court due to legal constraints, especially the EPF Act 1991 (Act 452). Hence, the question arises as to the position of the husband's EPF contribution; whether it can be claimed by the wife on the basis of the property or is there another basis? Hence, the objective of this article is to discuss the position of this claim, whether considered as 'wife's rights in accordance with Islamic law’ as opposed to 'property rights' in the Shariah Court. This qualitative study applied a content analysis approach for data collection and the analysis was presented descriptively. The results of the study found that the claim on the husband's EPF is more appropriate in the context of the 'claim of the wife's rights in accordance with Islamic law' than the 'claim of property rights' in the Shariah Court and in accordance with the maqasid syaria.

Financial Investment Pattern and Preference of College Professors at Trichy City

Financial Investments are the commitments that are made by individuals with any financial and non-financial instruments for gaining a better and profitable return in future for a particular objective. The financial and non-financial investment instruments act as a medium or a driving tool for investment decisions of individuals. From the available investment avenues one must select the appropriate one that he feels safer or good to invest. The person who is going to make investments should be aware of all knowledge about investments and should be aware of how it is going to fulfil his objective. The person who is investing should be known of all the investment avenues available for making investments. Such avenues are employee provident fund, public provident fund, mutual funds, insurance, bank deposits, real estate, gold, stock market. This study is about to analyse the investment pattern of college professors and their attitude towards investment avenues. It also aims to identify the reason behind making investment and to find their objective for making investment. It helps to find the behaviour of individuals while making investments. Further this study helps to find the relationship of various demographic factors of the respondents and factors associated while making investment decisions. Such factors include time period of their investment, investment avenues, risk factors, returns etc.

Identifying salient beliefs underlying intention to save regularly: an elicitation study of Malaysian Gen Y

PurposeUsing the integrated behavioural model as a theoretical framework, this study aims to identify salient beliefs underlying intention to save regularly among Gen Ys in Malaysia.Design/methodology/approachSemi-structured interviews were conducted with 13 participants who were selected using purposive and snowball sampling methods.FindingsWhile Gen Ys are not pushed by others to save, they find that older people (parents, parents-in-law, colleagues and relatives) influence them to save. The main facilitator of regular saving behaviour is low financial commitments. Expenses, particularly unexpected expenses, was found to be the main factor impeding the performance of regular saving. Overall, the participants feel that, irrespective of what happens in the future, they want to continue saving regularly. Lastly, self-efficacy might be present for some participants, but not self-control. Some end up withdrawing their savings for spending, emergency, and travel, thus ending up almost depleting their savings.Research limitations/implicationsOf this study’s 13 interviewees, only one has not managed to save any money. Such an imbalanced sample composition was not deliberate. It appears those who have not saved money were reluctant to be interviewed, as this topic might be uncomfortable for them. This could have led to only those who save being eager to be interviewed.Practical implicationsPolicy makers should find this study useful, as the behaviour of Gen Ys in Malaysia is different from the overall perception of Malaysians’ financial behaviours. Gen Ys have positive attitudes towards saving money, although they do not seem to practice long-term saving. Policymakers could identify, with banks and the Employee Provident Fund, ways to encourage Gen Ys to think long term. Government could play its part by creating and increasing awareness amongst Gen Ys on the long-term consequences of inadequate savings.Originality/valueThis study contributes to the literature by identifying the salient beliefs underlying regular saving behaviour through the conduct of elicitation interviews. It is an empirically grounded study enhancing the understanding of intention to perform regular saving among Gen Ys in an emerging market.

Employee Views Towards Retirement Scheme in Development Bank of Nepal

The main objective of the study is to assess the employee view toward the Employee Provident Fund (EPF) scheme, as a retirement scheme, with various factors that influence the attitude in development banks of Nepal. The study is based on a descriptive and explanatory research design. A quantitative research design was applied. Out of 18 development banks in Nepal, Jyoti Bikas Bank, Shangrila Development Bank, Muktinath Bikas Bank, and Garima Bikas was selected as sample unit for the study. The study is based on the primary data collected from Employees or contributors as respondents. Pearson’s multiple correlations and linear regression analysis were used for data analysis. Correlation analysis shows a significant linear, positive, and moderate relationship between independent variables namely, saving and investment, benefits scheme, and work environment, and dependent variable namely, employee view toward EPF scheme. The regression analysis reveals that there is a positive view of employees toward EPF in terms of saving and investment. Also, there is a positive view of employees toward EPF in terms of the working environment. However, there is a negative view of employees toward EPF in respect of the benefits scheme.

The Effect of Merging Pension Funds on Provision of Retirement Benefits in Tanzania: A Survey of Retirees in Dar es Salaam Region

Prior to merging pension schemes in the year 2018, there were a total of five recognized pension schemes in Tanzania. This paper investigated the impact of merging pension funds on the provision of retirement benefits in Tanzania. Specifically this paper intends to examine the impact of merging membership contributions on the provision of retirement benefits in Tanzania. A survey research design was deployed. Total of 100 retirees of Public Service Social Security Fund (PSSSF) retired from 2018 onwards in Dar es Salaam Region were involved. Non-probability sampling technique was deployed and the required sample was selected using purposive and convenience sampling methods. The obtained data was analysed quantitatively using descriptive statistics and Pearson’s correlation analysis. Overall results of this study showed that merging membership contributions, has positive and significant impact on the provision of retirement benefits (r= 0.311 respectively at 0.05 significant level). The study concludes that, the decision to merge four public pension fund; Local Authority Pension Fund (LAPF), Parastatal Pension Fund (PPF), Government Employees Provident Fund (GEPF) and Public Service Pension Fund (PSPF) to form Public Service Social Security Fund (PSSSF) has significant impact on the provision of retirement benefits to retirees in Tanzania. In order to ensure that merging the pension funds improves provision of the retirement benefits, the Government through PSSSF management should take measures such as increase sense of care of the pension contributions to employees of the PSSSF and by strengthening internal control systems.

RETIREMENT BENEFIT IN MALAYSIA: UNDERSTANDING THE LEGAL FRAMEWORK AND ITS CHALLENGES TO THE MIGRANT WORKERS

The retirement benefits scheme is one of the social security protections accorded to employees around the world. In Malaysia, the retirement benefits scheme is in the form of the contribution made by both employer and employee at a specified rate based on the employee’s monthly wages and such contribution will be credited into the employee’s fund. An employee is allowed to withdraw money from the fund when he or she reaches retirement age. The doctrinal study found that the retirement benefits scheme in Malaysia differs greatly between the local employees and migrant workers. Although migrant workers are allowed to contribute to the retirement benefits scheme known as Employees Provident Fund, their contribution is voluntary, and not done compulsorily. The contribution of the employer is capped at only RM5 per month, which is very low. It is exacerbated by the fact that the contribution in the fund is not transferable as the Employees Provident Fund Act does not provide any provision to transfer the retirement benefit to another scheme in another country. It is hoped that these challenges faced by migrant workers will be given due consideration by the government to allow the migrant workers to have adequate social security protection by reforming the current retirement benefit statute or introducing a new retirement benefit statute that only protects the migrant workers.

COVID-19 impact: Customised economic stimulus package recommender system using machine learning techniques

Background: The Malaysian government reacted to the pandemic’s economic effect with the Prihatin Rakyat Economic Stimulus Package (ESP) to cushion the novel coronavirus 2019 (COVID-19) impact on households. The ESP consists of cash assistance, utility discount, moratorium, Employee Provident Fund (EPF) cash withdrawals, credit guarantee scheme and wage subsidies. A survey carried out by the Department of Statistics Malaysia (DOSM) shows that households prefer different types of financial assistance. These preferences forge the need to effectively customise ESPs to manage the economic burden among low-income households. In this study, a recommender system for such ESPs was designed by leveraging data analytics and machine learning techniques. Methods: This study used a dataset from DOSM titled “Effects of COVID-19 on the Economy and Individual - Round 2,” collected from April 10 to April 24, 2020. Cross-Industry Standard Process for Data Mining was followed to develop machine learning models to classify ESP receivers according to their preferred subsidies types. Four machine learning techniques—Decision Tree, Gradient Boosted Tree, Random Forest and Naïve Bayes—were used to build the predictive models for each moratorium, utility discount and EPF and Private Remuneration Scheme (PRS) cash withdrawals subsidies. The best predictive model was selected based on F-score metrics. Results: Among the four machine learning techniques, Gradient Boosted Tree outperformed the rest. This technique predicted the following: moratorium preferences with 93.8% sensitivity, 82.1% precision and 87.6% F-score; utilities discount with 86% sensitivity, 82.1% precision and 84% F-score; and EPF and PRS with 83.6% sensitivity, 81.2% precision and 82.4% F-score. Households that prefer moratorium subsidies did not favour other financial aids except for cash assistance. Conclusion: Findings present machine learning models that can predict individual household preferences from ESP. These models can be used to design customised ESPs that can effectively manage the financial burden of low-income households.

COVID-19 impact: Customised economic stimulus package recommender system using machine learning techniques

Background: The Malaysian government reacted to the pandemic’s economic effect with the Prihatin Rakyat Economic Stimulus Package (ESP) to cushion the novel coronavirus 2019 (COVID-19) impact on households. The ESP consists of cash assistance, utility discount, moratorium, Employee Provident Fund (EPF) cash withdrawals, credit guarantee scheme and wage subsidies. A survey carried out by the Department of Statistics Malaysia (DOSM) shows that households prefer different types of financial assistance. These preferences forge the need to effectively customise ESPs to manage the economic burden among low-income households. In this study, a recommender system for such ESPs was designed by leveraging data analytics and machine learning techniques. Methods: This study used a dataset from DOSM titled “Effects of COVID-19 on the Economy and Individual - Round 2,” collected from April 10 to April 24, 2020. Cross-Industry Standard Process for Data Mining was followed to develop machine learning models to classify ESP receivers according to their preferred subsidies types. Four machine learning techniques—Decision Tree, Gradient Boosted Tree, Random Forest and Naïve Bayes—were used to build the predictive models for each moratorium, utility discount and EPF and Private Remuneration Scheme (PRS) cash withdrawals subsidies. The best predictive model was selected based on F-score metrics. Results: Among the four machine learning techniques, Gradient Boosted Tree outperformed the rest. This technique predicted the following: moratorium preferences with 93.8% sensitivity, 82.1% precision and 87.6% F-score; utilities discount with 86% sensitivity, 82.1% precision and 84% F-score; and EPF and PRS with 83.6% sensitivity, 81.2% precision and 82.4% F-score. Households that prefer moratorium subsidies did not favour other financial aids except for cash assistance. Conclusion: Findings present machine learning models that can predict individual household preferences from ESP. These models can be used to design customised ESPs that can effectively manage the financial burden of low-income households.

Critical Evaluation of the Effectiveness of the Retirement Benefit Schemes in Labour Legislations of Sri Lanka

Retirement can be considered as the most-evidence junction in life where someone decides to permanently leave the workforce behind. According to the right based theory, the state is obliged to look after individuals of the country, and particularly this includes retired elders who contributed their labour, energy and knowledge towards the economy of a country during their young age. The International Labor Organization (ILO) also requires that member countries should secure to the persons protected under the provisions of old-age benefit. However, this has become a difficult task with a recent trend of the aging of the population where the life expectancy of people has grown up. Sri Lanka also has taken some of the steps to enable a few legislations to address this issue of retirement benefits. In this context the main objective of this study was to critically evaluate the effectiveness of the existing labour legislations in Sri Lanka which discusses the retirement benefits. Special attention has been given to the recovery procedure of default payments under Employees Provident Fund Act, Employees Trust Fund Act and Payment of Gratuity Act. Apart from the discussion of the private and semi-government sphere, the researcher specifically dealt with the retirement benefits legislation on university employees by comparing it with the legislations applicable to other sectors. This research study utilized the qualitative methodology where the researcher studied, analyzed, and synthesized a variety of legal documents such as international conventions, legislations, case laws, books, and journal articles. Finally, the research reveals that the retirement benefits mentioned in all three major legislations do not support the state to ease the burden of looking after the old aged people and it is totally shifted to the youngsters of their families. This study fills the lacuna of having a comprehensive legal analysis pertaining to the area of retirement benefits in Sri Lanka including the state university sector by suggesting how the laws should be amended to fill the gaps in the existing law.
 Keywords: Elderly people, Contributory pension scheme, Retirement benefits.

COVID-19 impact: Customised economic stimulus package recommender system using machine learning techniques.

Background: The Malaysian government reacted to the pandemic's economic effect with the Prihatin Rakyat Economic Stimulus Package (ESP) to cushion the novel coronavirus 2019 (COVID-19) impact on households. The ESP consists of cash assistance, utility discount, moratorium, Employee Provident Fund (EPF) cash withdrawals, credit guarantee scheme and wage subsidies. A survey carried out by the Department of Statistics Malaysia (DOSM) shows that households prefer different types of financial assistance. These preferences forge the need to effectively customise ESPs to manage the economic burden among low-income households. In this study, a recommender system for such ESPs was designed by leveraging data analytics and machine learning techniques. Methods: This study used a dataset from DOSM titled "Effects of COVID-19 on the Economy and Individual - Round 2," collected from April 10 to April 24, 2020. Cross-Industry Standard Process for Data Mining was followed to develop machine learning models to classify ESP receivers according to their preferred subsidies types. Four machine learning techniques-Decision Tree, Gradient Boosted Tree, Random Forest and Naïve Bayes-were used to build the predictive models for each moratorium, utility discount and EPF and Private Remuneration Scheme (PRS) cash withdrawals subsidies. The best predictive model was selected based on F-score metrics. Results: Among the four machine learning techniques, Gradient Boosted Tree outperformed the rest. This technique predicted the following: moratorium preferences with 93.8% sensitivity, 82.1% precision and 87.6% F-score; utilities discount with 86% sensitivity, 82.1% precision and 84% F-score; and EPF and PRS with 83.6% sensitivity, 81.2% precision and 82.4% F-score. Households that prefer moratorium subsidies did not favour other financial aids except for cash assistance. Conclusion: Findings present machine learning models that can predict individual household preferences from ESP. These models can be used to design customised ESPs that can effectively manage the financial burden of low-income households.

DETERMINANTS THAT INFLUENCE THE ACTUAL BEHAVIOUR TO INVEST IN UNIT TRUST FUNDS: AN ANALYSIS OF THE ATTRIBUTES OF THE SALESPERSON

Despite the inherent and much-publicised benefits of investing in unit trust funds, not everyone is investing in them. Investing in unit trust funds, which is open to everyone, offers the investor, at low risks, returns which are potentially higher than those of savings, fixed deposit or even Employees Provident Fund. The relatively higher returns from unit trust investments could help the investor secure a more financially sound future, especially when it comes to his or her retirement. Based on observations, given the same socio-economic backgrounds, some people are more willing to invest in unit trust funds compared to others. Many probable factors are influencing a person’s decision to invest in unit trust funds. Using the Theory of Planned Behaviour and Trait Theory, this study aims to identify and examine those factors, especially the role of the salesperson, which can influence the intention to invest in unit trust funds, thus contributing to the body of knowledge about the Theory of Planned Behaviour in this regards. It is hoped that the findings of this study could help unit trust companies and other relevant parties design a more effective approach in encouraging more Malaysians to invest in unit trust funds and help them secure a more financially sound future. Data will be collected through a questionnaire by way of purposive sampling. Based on Cochran’s formula, 500 questionnaires will be distributed throughout Sabah, the sample population. The Independent Variables identified are attitude, subjective norm, a salesperson’s attributes and perceived behavioural control while the dependent variable is behaviour to invest in the unit trust. A pilot study on the questionnaire, which has been converted into Google form, had been distributed. A total of 44 complete questionnaires were considered for analysis, following which all the questions contained in the questionnaire passed the Cronbach’s Alpha Test for reliability.

Financial Risk Tolerance: The Case of Older Chinese in Klang Valley, Malaysia 2020

Ageing demographic profiles pose challenges to the nation as policymakers are concerned about the health, public pension and the financial management of the society. In Malaysia, retirees are mostly dependent on savings from the Employees Provident Fund (EPF), a government agency that manages savings and retirement plans for private-sector employees and non-pensionable public servants. Many Malaysians aged past the targeted retirement age of 60 years old chose to remain in the workforce, mainly due to insufficient retirement funds or has depleted their retirement funds in a short period. To ensure sufficient funds to attain an ideal retirement life, Malaysians resort to invest or seek business opportunities. Thus, this paper studies the impact of demographic characteristics (sex, age, and educational level) and finance characteristics (financial knowledge and financial satisfaction) on the risk tolerance among older Malaysian Chinese in the year 2020. The results of this study showed that the older Malaysian Chinese risk tolerance is highly influenced by sex, age, education level, financial knowledge and financial satisfaction.

Evaluation of the Employees’ Provident Fund in Jordanian Public Universities

The current initial study comes to explore the current status and the future trend of the Employees’ Provident Fund (EPF) among Jordanian public universities. Based on the responses of 167 employees from two public universities, the results show a weak investment policy in EPF and a general unsatisfactory attitude towards the current status of EPF investments. Uncertainty in the future of EPF and the scarcity of financial resources are the main barriers of investing in EPF. Employees stress numerous future corrective actions to enhance the role of EPF in serving the members. Results also show that the monthly salary is the key factor that affects the perception of employees towards the current status of EPF investments, barriers of investments in EPF, and the future corrective actions of EPF. As a rare study in EPF in universities, it offers valuable recommendations to policy-makers to develop the different perspectives of EPF.

Treatment Costs for Nasopharyngeal Cancer by Stages: Patients’ Experience in Sarawak General Hospital

The study investigates an average direct and indirect costs incurred by Nasopharyngeal Cancer (NPC) patients who received diagnosis, treatment and follow up in the Sarawak General Hospital, Kuching, Malaysia. A total of 299 NPC patients were randomly selected using a primary data collection approach from the Sarawak General Hospital between November 2018-March 2019. Information related to the average direct and indirect costs incurred by NPC patients at various stages and the sources of their financial assistance throughout the treatment periods were assorted. The study reveals that the total average cost of 169 or 56.52% of the NPC patients who received various treatment services in the public hospital is RM13,165 against RM78,860 on 130 or 43.48% of the patients received the same services in both public and private healthcare. Major sources of funding come from patients’ savings, family members, medical insurances, non-profit organization or charity, company healthcare benefits, employees’ provident fund (EPF) as well as subsidy from the government: This study suggests that the treatment cost for cancer patient is high and hence, there is a need to establish a mechanism that can provide a free screening test for NPC as a forward step to cancer prevention, while for policy makers to develop a more supportive initiative to address the needs of the poor patients.