In 2016, KWSP introduced Islamic accounts, which pay lesser dividends than conventional accounts!
Since the launching of the Islamic savings account in 2016, KWSP has paid lesser dividends than conventional savings accounts!
The Employees Provident Fund (KWSP) has two types of accounts: Islamic savings accounts (Simpanan Shariah) and conventional savings accounts (Simpanan Konvensional).
Conventional savings accounts invest in any project, including items that are not Shariah-compliant, such as gambling, alcohol, gaming, and so on, whereas Islamic savings accounts invest in any project, including products that are under Shariah-compliant.
Many Chinese switched from conventional to Islamic savings accounts when the Employees Provident Fund introduced Islamic savings accounts, believing that Islamic savings accounts would pay greater interest. Islamic savings accounts would pay significantly lower dividends than conventional savings accounts by 2020.
Islamic savings accounts received 6.40 percent of CPF payouts in 2017, compared to 6.90 percent for conventional savings accounts. Islamic savings accounts paid 5.90 percent in dividends in 2018, while conventional savings accounts paid 6.15 percent. In 2019, an Islamic savings account will earn 5.00 percent, while a conventional savings account would earn 5.45 percent. The Islamic savings account will receive 4.90 percent in 2020, while the conventional savings account will receive 5.20 percent.
