Banks usually don't easily sue a debtor with a CPF because the CPF is a safeguard that can help the debtor avoid more serious financial hardship.
Usually, if you owe money to the bank and have been in arrears for a long time, they will first try to collect it to get it back. However, if you still don't pay back, the bank may choose to pursue the debt through legal means. However, banks rarely choose to sue those who owe CPF. This is mainly due to several reasons:
The first reason is that most of the debtors are civil servants, employees of enterprises and institutions, or employees of central enterprises and state-owned enterprises, and they have provident funds. This means that the nature of their workplace and the fact that they have CPF is the best proof of their ability to repay! Banks usually give some respite to those who are still able to repay their debts.
The second reason is that banks need to maintain special customer relationships, which is why they do this. Those who owe money generally have jobs, and banks usually have business dealings with these customers, such as paying salaries, paying mortgages, borrowing large amounts, etc. Banks do not want to affect their relationship with these entities because of the lawsuit.
The third point is because of the need to recover subsequent debts. If a bank files a lawsuit against a person who owes CPF money, it may cause their jobs to be affected and may even result in them being cut or forced to leave their jobs. If so, then it may become more difficult to pay off debts.