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I-SINAR PROGRAMME: SHOULD I APPLY?

December 18, 2020
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Based on recent approved Budget 2021, the government has taken the initiative to help 2 million members of Employment Provident Fund (EPF) through the i-Sinar programme where the members can withdraw savings from their Account 1. The Minister of Finance, Datuk Tengku Zafrul Tengku Abdul Aziz has stated that the purpose of the programme is to help people who are affected from the current COVID-19 pandemic especially those who lose their job, given no-pay leave and no other source of income.

Eligible members can apply for i-Sinar starting from December 2020. They are allowed to withdraw 10% from their savings in Account 1, with condition of having RM100 balance. All funds will be credited directly to member’s Bank Account by the end of the month. The first advance will be received in January 2021 followed by the 5-subsequence month.

To illustrate further:

a. For those with RM100,000 and below in Account 1, they can withdraw any amount up to RM10,000. Payments will be staggered over a maximum period of six (6) months with the first payment of up to RM5,000.

b.For those who have above RM100,000 in Account 1, they can withdraw a maximum 10% of their Account 1 savings, up to RM60,000 (whichever is lower). Payments will be staggered over a maximum period of six (6) months with the first payment of up to RM10,000.

Click here for more information regarding KWSP i-Sinar programme.

However, do note that i-Sinar programme does not work as a withdrawal facility. you will need to pay back the advances based on the amount you withdraw from your Account 1. Moreover, you will lose the benefit from your Account 2 such as your medical and education expenses temporarily as all your future contributions will be transferred 100% directly to your Account 1. Once you have settled the amount of advanced you withdraw, your contributions will return back as normal where 70% goes to Account 1 and 30% to Account 2.

All in all, should you apply for i-Sinar programme?

We have included different scenarios as an indicator of whether you should apply for i-Sinar programme.


Scenario 1: Suitable Candidate

Ali is 34 years old who used to work as a pilot in the Aviation Industry. However, he has been unemployed for over 5 months due to the decline workforce in the Aviation Sector. To bounce back, he is planning to open his own burger business to cover up his daily expenses. However, he does not have enough capital to run the business smoothly.

Hence, Ali is recommended to apply for i-Sinar programme where it can help him start his own burger business to generate income. Withdrawing savings through i-Sinar programme would definitely benefit him in making sure that he can sustain his financial independently.

Scenario 2: Non-Suitable Candidate

Aminah is 49 years old who are still working for a big corporation. Due to the current pandemic, the company Aminah is working with has decided to do a cost cutting as part of sustaining the corporation. This has affected Aminah salary where she will receive 40% less than her actual salary for the next 10 months. Moreover, she still has commitments such as personal loan and bills that needs to cover but does not want to use her own savings to make all the payment.

In this case, Aminah is not recommended to apply for i-Sinar programme. Instead, it is recommended that Aminah to restructure loan repayment (refer article here) with financial institutions. The government has implemented a Repayment Assistance Clinics through financial institutions where it can help Aminah restructure her loan. She can also seek advices from AKPK on financial planning and restructuring.


To conclude, the government has provided great financial support through many programmes to help assist those who are affected by the current COVID-19 pandemic. However, do note that i-Sinar programme is meant to help citizens who lost their job, given-no pay leave and no other source of income. Think carefully before you withdraw because your EPF collective contribution is able to safeguard and grow your retirement saving. Lets plan and spend our money wisely. Subsribe to our newsletter, to follow up with our latest news and article from us!

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