THE private retirement schemes (PRS) attracted strong interest, especially among those aged below 30 years as the net asset value (NAV) rose 20% to RM2.66bil last year.
The Private Pension Administrator (PPA) Malaysia, which is the central administrator for PRS, says that despite the economic challenges domestically and internationally, more people saved with PRS in 2018 than in any previous years since the launch of the PRS in 2012.
The total number of PRS members grew by 38% to 416,913 last year, up from 301,279 in 2017. Total net asset value (NAV) for PRS funds also rose by 20% to close the year at RM2.66bil.
PPA Malaysia chief executive officer Husaini Hussin says “more people are aware that PRS is a long-term savings scheme and are less worried about short-term market volatility”.
He recalls that last year he said it would not be easy to continually grow the PRS industry in the range of 30% annually, “but we sustained the growth momentum in spite of 2018’s challenging environment”.
Almost 40% of PRS members are aged 30 and below, Husaini says, pointing out that more young adults are taking retirement planning seriously.
“The youth incentive has ended, but the drive to continue encouraging the youth to save for their future remains.
“We will continue to reach out to the youth through social media and community programmes as well as collaborate with public and private universities across the country to improve financial literacy among students.
“PPA will also work with the industry to make it more affordable for the youth segment to start saving with PRS,” Husaini says.
Last year, PPA launched PRS Online Enrolment to allow individuals to sign up and save via www.ppa.my.
PPA has been making it easing for PRS members to top up their contributions and this has seen a push into online platforms such as the PRS Online Top Up, which was introduced in 2016.
Since its rollout, PRS Online has attracted much attention and more PRS members are now using the platform to manage their accounts.
myPPA, a mobile app, is also available for PRS members to review and monitor their savings with their smart devices.
Husaini says for this year, PPA plans to introduce more value-added services and digital initiatives so the members can automate their savings by setting aside a fixed sum for their retirement fund every month.
This push into financial technology will be another step forward in shaping individuals’ savings behaviour positively.
Another key area for PPA is advocating Corporate Malaysia to make retirement planning and financial wellbeing an essential component of workplace policy.