KUALA LUMPUR: The move to encourage Uber drivers in Malaysia to start saving for their retirement was given a boost following the signing of an MoU between the Employees Provident Fund (EPF) and Uber Malaysia.
The MoU was signed on Thursday to encourage Uber's ride-sharing driver-partners to save under the 1Malaysia Retirement Savings Scheme (SP1M) under the Employees Provident Fund (EPF).
Under the SP1M, individuals who are self-employed or with no fixed monthly income, such as taxi drivers, petty traders, farmers, housewives and freelancers as well as Malaysians working abroad, can contribute to a retirement fund managed by the EPF.
EPF's CEO Datuk Shahril Ridza Ridzuan said the SP1M was introduced in 2010 due to the growing number of Malaysian informal sector workers who do not have enough savings or financial assets to provide for their retirement.
“In addition, Uber has agreed to other areas of collaboration, including facilitating a series of financial planning talks by EPF and allowing EPF to promote retirement planning to driver-partners.”
The general manager for Uber in Malaysia and Singapore, Warren Tseng, said the MoU would help driver-partners make better choices for their retirement plans and future financial security.
“While driver partners have contributed greatly to improving urban mobility and connectivity, we now want to encourage them to take charge and be in the driver’s seat of their own retirement,” he said.
Under the SP1M scheme, individuals may voluntarily contribute a minimum of RM50 into their SP1M account up to a maximum of RM60,000 a year and entitled to earn dividends on their savings.
Driver partners who become members of SP1M will also enjoy the same benefits enjoyed by current EPF members such as the RM2,500 death benefit (subject to terms and conditions).
On top of the yearly dividends and EPF benefits, the government will contribute 10% of the annual contributions to a maximum of RM120 per year until end of this year for members below age 55.
“The EPF is currently in discussions with the government to continue extending this benefit,” it said.
The Department of Statistics Malaysia reported that out of 22 million of Malaysia’s working population, only 6.8 million are actively contributing to the EPF and 1.7 million are covered by the public pension scheme.
The remaining 13.7 million are self-employed or freelancers who are not covered by any formal social protection programme in the country.
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