Over 94,000 declared bankrupt since 2013

By P PREM KUMAR & DASHVEENJIT KAUR

More than 94,000 individuals have been declared bankrupt by the Malaysian Insolvency Department since 2013, says the Prime Minister’s Department.

Minister in the Prime Minister’s Department Datuk Seri Azalina Othman Said said from the total 94,408, about 91,180 people, or 96.6%, were declared bankrupt due to the failure to pay instalments from financial institutions.

“The financial institution products which resulted in bankruptcy include hire-purchase loan, personal loan, housing loan, business loan, credit card, social and corporate guarantors,” she said in a written parliamentary reply yesterday.

She was responding to Setiu MP Datuk Che Mohamad Zulkifly Jusoh who asked the government the number of bank loan holders who have been declared insolvent.

Azalina said hire-purchase borrowers consist some 27.6% of the total number of people declared insolvent between the year 2013 andAugust 2017.

Thus, the government, she said, is implementing various initiatives as it views the bankruptcy rate among Malaysians seriously.

Among the measures include the introduction of a consumer credit law that would control granting of credits, while directly protecting consumers.

“One of the consumer protection mechanism which would be considered is for financiers to give fair consideration to borrowers who are facing unforeseen financial issue,” she said.

Bank Negara Malaysia (BNM) has also issued a responsible lending guideline which enforces financial institutions to assist borrowers who are facing difficulties in repayments due to disease, unemployment or other reasonable factors.

“In case the borrower is found to be facing difficulties to repay loan or would like to negotiate on an alternative repayment plan, financial institutions should provide fair consideration and offer a suitable alternative structure,” she explained.

As an alternative, borrowers can also seek advice from the Credit Counselling and Debt Management Agency, an agency set up by BNM in April 2006.