Tasek Gelugor MP Wan Saiful Wan Jan has hit out at the government over an Employees Provident Fund (EPF) initiative for the use of members' savings balance as backup for bank financing, citing a conversation with a contributor whom he said was now RM35,000 in debt with his retirement funds put up as collateral.

In a Facebook post, the Bersatu man said the contributor was one of a group with whom he had met, who had received approval for the EPF's Account 2 Support Facility or FSA2.

"Interestingly, all of them were given approval despite being bankrupts," he said, adding that some were still unable to withdraw the total approved sum while others had received messages from MBSB Bank instructing them to obtain a letter of discharge from the insolvency department.

"Otherwise, their loan will be cancelled even though the funds have already entered their bank accounts.

"How can it be that loans have been approved and the funds deposited into personal accounts, but the borrower is not allowed to spend the money?

"If these people were ineligible due to their bankruptcy status, why were their applications approved? And not only were they approved, the funds went into their personal accounts."

Wan Saiful said the contributor in question had shared screenshots of his account showing a loan of RM18,000 from MBSB Bank with his EPF funds pledged as collateral.

"MBSB charged an interest rate of 4.5% across a loan period of nine years. The full amount he has to pay is RM35,601.12 – double the amount of RM18,000 that he borrowed," he added.

"I urge Anwar, as finance and prime minister, to explain why his administration is so chaotic, to the point where people who are already in difficulty are being mistreated like this.

"There has never been a prime minister who suggested that the solution for those who are bankrupt due to debt is to add on more debt."

He also called on Anwar to explain how individuals categorised as bankrupts could receive the green light for loans, and provide assurance that if their loan is cancelled, they will not be charged any fees or interest even if the money had been deposited into their personal accounts.

"He should also ensure that the borrowers who have taken loans are not unjustly forced to return the money, and explain the government's rationale for forcing contributors to increase their debts so that the repayment amounts become even more of a burden.

"If Anwar cannot accept the fact that his upside-down policies are burdening the people, it would be better for him to resign as finance minister and let someone more competent take over."