New Zealand's approach of great interest at conference in Malaysia
16 October 2013
New Zealand’s national strategy for financial literacy, the way the Commission works with private sector partners, and Sorted’s ‘Think, Shrink and Grow’ campaign were of great interest at the Malaysian Financial Literacy and Retirement Savings conference in Kuala Lumpur.
The Commission’s Executive Director, David Kneebone was invited and funded to travel to Malaysia in September to speak at the conference about New Zealand’s financial literacy programme.
David shared the platform with speakers from the OECD plus Australia, Singapore and Malaysia.
“As well as sharing our news, it was great to have the opportunity to learn more about Malaysia’s retirement income framework. One key point of difference between our countries is that the Malaysian population doesn’t have access to a tax payer funded pension in retirement.”
“Rather than a pension, all employed Malaysians must contribute to an Employees Provident Fund (EPF). Active members of the EPF contribute 11% of their wage or salary, which is matched by a 13% employer contribution,” he says.
An issue mentioned often during the conference was the growth of consumerism in Malaysia, with increasing products and services to buy and accompanying social pressure. In particular, the expectation around extravagant weddings is seeing an increase in consumer debt, which many struggle to manage.
In 2006, the Malaysian Central Bank (Bank Negara) established a subsidiary (AKPK) which offers financial education, counselling and debt management advice, free of charge to the Malaysian public. The service has already helped almost 300,000 Malaysians via its 10 outlets and free phone service.
David spent an afternoon with staff at AKPK assessing the impact of their service, which appears very positive and capable of stimulating behavioural change.