The new savings scheme “Skim Amanah Rakyat 1Malaysia” or SARA was earlier announced in Malaysia’s 2012 budget late last year. During the announcement not much detail was shared on the detail of the new scheme. Tabling the budget Prime Minister Datuk Seri Najib Razak shared that the new savings scheme will benefit more than 100 thousand households which were earning below RM 3,000 per month.
Recently this week the full details of the fund was launched. Here are some facts of the savings scheme:
- The scheme will be opened starting 30th January 2012.
- The scheme, under the Ministry of Finance, is managed by Permodalan Nasional Berhad’s sister company, Amanah Saham Nasional Berhad.
- Application forms are available at Malayan Banking Berhad, CIMB Bank, RHB Bank and Bank Simpanan Nasional.
- Scheme allocation similar to Amanah Saham 1Malaysia (AS 1Malaysia), i.e. Bumiputera – 50%; Chinese – 30%; Indian – 15%; Others – 5%.
- The government has set aside RM100 million to kick-start the scheme
- The scheme is a hybrid of a unit trust investment and loan product, capable of generating consistent cash flow or monthly incentives.
When Will It Be Launched?
- The forms will be distributed from Jan 30 for 100,000 households on a first-come, first-served basis.
- Those earning RM3,000 and below a month are in for a treat again with the launch of a new savings scheme.
- Open to all Malaysians aged between 18 and 58 years old
- Applicants must not be declared bankrupt at the point of application and throughout their participation in the Scheme
- Applicants to the scheme is not a participant or beneficiary of any ASNB-related government programme such as “ASW2020-Bandar”, “Program Pembangunan Rakyat Termiskin” and “ASB Sejahtera
- Applicants do not have any investments in ASNB unit trust products OR if there is, household have a combined aggregate investment of less than RM10,000 in all ASNB products.
How to Invest? How is the return on investment?
- Option to the low-income group to pay cash or take up a loan of RM5,000 to participate in the scheme.
Maximum investment of RM 5,000 only.
For a savings amount of RM 5,000, the government guarantees that those who pay cash will get RM134 monthly or RM13,000 after five years. That’s a cumulative return of a whopping 160% in 5 years!!
To those takes a loan will get RM50 monthly or RM8,000 after five years. That’s a cumulative return of 60% in 5 years!!
- The monthly incentives will be paid to participants in the form of additional AS 1Malaysia units, and the investors have to ensure that they make monthly loan payments for five years.
- Applicants are required to provide original and certified true copies of the following:a. Identity card of applicant – 2 copies
b. Identity card of spouses(s) (if applicable) – 1 copy
c. Proof of income:
- 1 copy of latest three months’ Pay Slip
- 1 copy of latest three months’ Bank Statement
- The loan is offered at a fixed amount of RM5,000 per household. for purchase of 5,000 Amanah Saham 1Malaysia (AS 1Malaysia)I units.
- Loan tenure is 5 years.
- Early settlement of the loan is not allowed. However, prepayments by participants are allowed.
- A participant who misses three consecutive monthly payments will be disqualified from the Scheme programme.
For more information please go to Skim Amanah Rakyat 1Malaysia webpage.