Local lenders engaging 2m borrowers on loan repayment assistance

Please go to the bank immediately if you need the post-moratorium assistance, deputy finance minister says

graphic by DAYANG NORAZHAR

LOCAL banks have reached out to two million borrowers as of Aug 28 to offer targeted assistance on the repayment of loans, Deputy Finance Minister II Mohd Shahar Abdullah said.

The Paya Besar MP told the Dewan Negara yesterday that 1.1 million borrowers have since responded and he expects the numbers of successful applicants to increase further by the end of the month as many are still weighing their options.

“Out of the 1.1 million who have responded, 300,000 have confirmed their details. We have approved 97% of the confirmed applications and the 3% whose applications were rejected can reach out to the Credit Counselling and Debt Management Agency (AKPK),” Mohd Shahar said.

He was responding to Senator Datuk Razali Idris who inquired on the number of targeted groups that would benefit from the extended loan moratorium. Mohd Shahar later told reporters that some applications were rejected after it was found that some borrowers did not meet certain criteria such as their employment status.

He said applicants would have to inform the banks and provide the necessary information to qualify for the assistance. The submission deadline is on Sept 30.

Mohd Shahar urged the public to immediately take action and go to their respective banks to confirm the assistance, especially for borrowers still needing the post-moratorium assistance, to avoid deteriorating credit records after September.

Among the measures stipulated by Bank Negara Malaysia include three months of extended financing moratorium for individuals who lost their jobs in 2020 and are still unemployed.

There are also options to reduce financing instalments for those experiencing salary cuts for at least six months, payment of interest-only for a specified period and an extension of the entire financing period to reduce monthly repayments.

“It takes between one and five days to process an application from individual borrowers and between three days and two weeks for small and medium enterprises (SMEs). People would not have to worry because the flexibility given to borrowers during this period will not be reflected in the borrowers’ central credit reference information system (CCRIS) report,” he said.

Prime Minister Tan Sri Muhyiddin Yassin had on July 29 announced that the government would extend the loan moratorium for individuals and SMEs on a targeted basis. Mohd Shahar said the moratorium extension was done on a targeted basis to ensure that banks had sufficient liquidity.

The loan moratorium, which came into effect on April 1, will end on Sept 30.

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz last week said the value of moratorium on loan repayment amounted to RM78.14 billion as of Aug 21. Of the total, he said RM50.79 billion was utilised by individual borrowers, while the remaining was by businesses.