Electronic devices shop manager Jeft Tan (right) explaining a product to a customer at a mall in George Town. — CHAN BOON KAI/The Star
AT a time when many young people are likely to splurge on new clothes and goods ahead of Hari Raya Aidilfitri, Nur Syahnaz Zainol is the odd one out.
The sales promoter has resolved not to buy anything she cannot pay for in full.
Nur Syahnaz, who lives with her parents, said her family would also celebrate modestly, with a small budget she had set aside to stock up on festive goodies.
“I prefer paying for things in cash, based on what I can afford.
Nur Syahnaz worries that purchasing via instalment will encourage overspending.“I will not easily commit to instalment payment plans but will instead save up until I can pay in full,” she said.
For Nur Syahnaz, payment plans are for major purchases like a house or car.
To manage expenses, she sets aside part of her salary for shopping that prioritises household necessities.
Nur Syahnaz is worried that regulated payment plans may encourage unnecessary spending.
“These plans tie me to a contract which I would rather avoid.
“After covering utility bills and food, I limit my other shopping and leisure expenses to 20% of my salary,” she said.
Assistant manager Richard Paul said while paying through instalments was once considered a necessity, times have changed.
“I remember in the 1980s, many household appliances and furniture were often bought via payment plans.
“Today, I pay cash whenever possible and only use a credit facility for major expenses like buying a car.
“I limit my spending to what I can afford upfront,” he said.
Paul said while paying in instalments was once a necessity, times have changed.Consumers’ Association of Penang (CAP) president Mohideen Abdul Kader acknowledged that most people would need some form of credit facility at one point or another in their lives.
However, he pointed out that even small purchases were nowadays often made on credit, and consumer behaviour was largely driven by buy now, pay later (BNPL) schemes.
He said it would be beneficial if BNPL terms and conditions were standardised and also clearly stated.
Mohideen was commenting on the Consumer Credit Bill 2025, to protect consumers who buy on credit and ensure responsible lending, which was tabled for first reading in the Dewan Rakyat.
Among the aims of the Bill is the setting up of a Consumer Credit Commission as well as the regulation of credit businesses, including BNPL schemes.
Mohideen said parts of the proposed Act should be highlighted to educate consumers about their rights.
For example, he said under “Part VII – Business Conduct For Credit Consumer Protection”, credit-offering businesses or credit services such as companies with BNPL schemes and debt collectors must follow several requirements.
“There must be transparency and disclosure on the requirements, including the provision of information that is accurate, clear, timely and not misleading.
“It also requires fairness of terms in a credit agreement as well as fair debt collection practices.
“There must also be provision of assistance to a credit consumer with financial hardship, to help them meet financial obligations under a credit agreement.
“This assistance would include complaints handling and dispute resolution mechanisms,” said Mohideen.
There may be times, he added, when a consumer’s financial situation takes an unexpected downturn.
“This can leave consumers in a difficult spot.
“We hope that the new Act will see credit consumers treated fairly,” he said.
