What are the key differences between the Employees Provident Fund (EPF) and the PRS?
- With the exception of certain categories, all employees under a contract of service are required to contribute to the EPF. By contrast, the PRS is a voluntary scheme for individuals who are 18 years old and above.
- The EPF, which comes under the purview of the Ministry of Finance, has to maintain a minimum guaranteed return of 2.5% annually to its depositors. On the other hand, the PRS managed by the private financial intermediaries approved by the Securities Commission Malaysia ("SC") does not provide a guaranteed return.
- All PRS contributions are separate and do not affect your mandatory EPF contributions. Your mandatory EPF contributions (both your own personal deductions and also your employer's contribution) will remain the same.