By DASHVEENJIT KAUR / Pic By ISMAIL CHE RUS
The Credit Counselling and Debt Management Agency (AKPK) assisted 14,688 individuals to fully settle their debts totalling RM593 million through its debt management programme (DMP) as of Sept 30, 2017.
Its CEO Azaddin Ngah Tasir said a total of 619,036 individuals had attended AKPK’s counselling services since its inception in 2006 up to September this year — and out of this number, 195,559 individuals had enrolled for the DMP.
“As of September this year, out of those 195,553 individuals, 14,688 cases successfully exited from the DMP with a total outstanding of RM593 million,” he told reporters during the press conference of the AKPK collaborators awards in Kuala Lumpur yesterday.
The DMP was created to assist financially troubled consumers to manage their debts.
Azaddin said AKPK’s statistics showed that poor financial planning remains the major reason faced by its clients, constituting 45.1% of the cases received.
This is followed by high cost of living (18.5%), failure or slowdown in business (14.8%), high medical expenses (9.6%) and lost of job or retrenchment (9.5%).
He also said the financial position of youths has been averaging about 15% since the last two years.
The debt counselling agency under Bank Negara Malaysia has recorded an alarming increase in people aged between 30 and 50 years old joining the DMP.
“The numbers are increasing since 2015,” he said, adding that of the total, 15% of those in the programme were under 30 years old, while 68.7% are in the 31 to 50 years age group.
“The older you get, you tend to get yourself in more debts involving housing loans, car loans and others.
“So, we feel there is more need to help and assist those in the age group of 30 to 50 years old to reduce their debt burden,” he said.
Azaddin said among the youths, education and awareness are important as many studies have showed the tendency of millennials to be dragged down by debts.
This commiserates with a study done by the Asian Institute of Finance (AIF) in 2015, which found a majority of youths to be living on high borrowing costs, 38% of youths relying on personal loans, while another 47% engaging in expensive credit card borrowings.
The statistics by AIF showed that there is an unprecedented debt accumulation among Malaysia’s millennials or Gen Ys.
It also showed that a worrying 75% of Gen Ys have at least one source of long-term debt such as car loans, education loans and mortgages, while 70% of those who own credit cards tend to pay the minimum monthly payment and 45% did not pay debt on time at some point.
In terms of bankruptcy, Azaddin said those who have joined the DMP are on the verge of bankruptcy.
“Our aim is not to make the public come to us only on the verge of bankruptcy. We urge them to come to us even if it’s merely just for financial advice or counselling,” he said.
Azaddin noted that to date, a total of 3.1 million Malaysians have enjoyed AKPK facilities in the form of financial management programmes through forums, seminars, mobile exhibitions and workshops
“In addition, 34 private higher education institutions have implemented the AKPK education module as part of the entrepreneurial subject or curriculum,” he added.
Azaddin also clarified that AKPK does not appoint agents to get the public to sign up for its programmes.
“There are groups out there that claim to be under AKPK which will then get the public to pay up for our programmes. Please know that our pro- grammes are free of charge and anyone keen can liaise directly with us,” he said.