Bank Negara clears up the confusion

  • Banking
  • Friday, 01 May 2020

KUALA LUMPUR: Bank Negara Malaysia (BNM) regrets the confusion that arose from misperception, which is to some extent caused by an illustration provided in its earlier version of frequently asked questions (FAQs), where certain assumptions and caveats were made.

"We sincerely regret any confusion and anxiety that this announcement may have caused. The deferment of loan repayments is meant to ease cash flows for borrowers/customers affected by the COVID-19 pandemic. This intent remains the same.

"We later removed the illustration when financial institutions provided their own. Our illustration was not intended to preclude interest charges accrued on the deferred loans,” the central bank said.

The confusion arose because of the misperception that the repayment amounts for a hire purchase (HP) loan cannot be changed, it said in a list of FAQs released today on the six-month payment deferment for hire- purchase (HP) and fixed rate Islamic financing.

Borrowers/customers who have had their HP loans and fixed-rate Islamic financing accounts automatically deferred since April 1, 2020 will continue to benefit from the payment deferment until Sept 30, 2020.

HP loan and fixed-rate Islamic financing borrowers/customers who initially accepted the moratorium but have since changed their mind can still opt out of the deferment, it added.

In its announcement on March 25, BNM had advised borrowers that interest/profit will continue to accrue on deferred payments and they should consider this in deciding whether they wish to take up the moratorium. - Bernama

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