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With almost three million applications online, the process to access the second partial withdrawal of private pension funds, approved by Congress to alleviate the economic crisis generated by the pandemic.
According to government calculations, with this new withdrawal about 4.2 million affiliates to the AFPs – almost a third of the total – will have their savings accounts at zero.
Until noon, the Pension Fund Administrators (AFP) registered “a total of 2,793,101 applications successfully admitted ”, one million more than on the first day of the first withdrawal four months ago, Fernando Larraín, general manager of the AFPs, explained to the press in a preliminary balance.
This reflects “the high interest of the affiliates to withdraw part of their provisional savings and that the digital process is working in a good way “, according to Larraín added.
Long lines could also be observed on the outskirts of the Administrators’ offices, to the extent that foreign workers and people who claimed not to know how to do the procedure online were present.
Focus on higher income quintiles
Congress approved this new advance of up to 10% of pension funds a week ago after a request from opposition legislators.
The previous one, approved in July, was charged by almost 10 million affiliates to the AFPs, which together withdrew some US $ 18,000 million.
The injection of liquidity derived from this operation strongly boosted private consumption.
The impact of the second withdrawal “will be less than the first,” indicated the Central Bank (BC), because “the drop in income caused by the pandemic would have already been more than offset by the previous measures, and because resources that could be withdrawn are concentrated in the highest income quintiles.
The latter group, added the BC, have fewer incentives “or less need to use” money for consumption, explained on Wednesday Mario Marcel, president of the issuing institute when presenting the latest Monetary Policy Report (IPoM).
The amounts and the tax
Just like last time, the minimum amount to withdraw is 35 UF (approximately $ 1,000,000) and the maximum 150 UF (approximately $ 4,300,000). People who accumulate in their accounts an amount less than 35 UF will be able to withdraw the total.
“When making the withdrawal request, the affiliate must indicate whether he wishes to withdraw 100% of what is allowed or a lesser amount,” detailed the AFPs.
The payment of the funds in cases of withdrawals of less than 35 UF will be made in a single installment and in a maximum period of 10 business days from the presentation of the application before the AFP.
Withdrawals greater than 35 UF will be paid in two installments, the first after 10 business days from when the request is submitted to the AFP and the second, 10 business days after the first payment.
But unlike the first, this time the obligation to pay taxes for the amount taken from workers who earn more than $ 1.5 million per month.
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