Grab drivers can now sign up to contribute a portion of their earnings to the Employees Provident Fund (EPF) voluntary retirement savings programme, which both Grab and EPF will top up.
EPF chief executive officer Datuk Shahril Ridza Ridzuan says by contributing to Caruman Sukarela Insentif Persaraan (i-Saraan), Grab driver-partners will benefit from annual dividends on their retirement savings, tax relief, death benefit and access to EPF's Retirement Advisory Service at no cost.
"We would like to encourage the community of Grab driver-partners to voluntarily sign up as EPF members and save for their retirement with the EPF. Our members are provided with a secure savings option, as the EPF has a proven track record of sustainable, above-inflation returns which will enhance the value of their savings over the long term," he said, at the signing of a Memorandum of Understanding (MoU) between Grab and EPF today.
He adds that on top of annual dividends and benefits, the Government will top up an additional 15% of annual contributions to a maximum of RM250 per year until 2020, for members below 55-years-old.
Starting August 16, Grab will also provide a 5% contribution to the amount saved by selected driver-partners but it's limited to a maximum of RM80 a year.
Grab Malaysia country head Sean Goh says a survey of their driver-partners revealed 75% expressed interest to save for their retirement specifically through this collaboration.
“Grab Malaysia is proud to partner the EPF in supporting the Government’s initiative to create a more holistic social protection ecosystem, starting with ensuring the retirement wellbeing of our Grab community of driver-partners. We therefore want to encourage them to take charge and be in the driver’s seat of their future financial security,” he says.
Previously known as the 1Malaysia Retirement Savings Scheme (SP1M), i-Saraan is designed to allow self-employed individuals or those who receive no regular monthly income like as taxi drivers, petty traders, farmers, and gig economy workers to save for retirement while enjoying the same benefits as EPF members.
However, since i-Saraan is the gig economy worker's version of full time staff's EPF, this MOU does not suggest Grab is moving to acknowledge driver-partners as actual staff, something hotly contested
in other countries.
Institute of Labour Market Information and Analysis (ILMIA) statistics reveal that of Malaysia’s working population of 22 million, about 7.1 million actively contribute to EPF while 1.7 million are covered by the public pension scheme.
The remaining 13.2 million are self-employed or freelance workers, outside the labour force and not covered by any formal social protection programmes.