KUALA LUMPUR: It has become so easy to borrow money from Ah Long that a loan from them is now just a phone call away.
MCA Public Services and Complaints Department chief Datuk Seri Michael Chong said there has been an increase in the number of loan sharks in recent years.
Competition to get new borrowers has become stiffer as a result.
“It’s now gotten to a stage that the borrower doesn’t even need to meet the loan shark or sign any agreement.
“Just call the loan shark, give them the address for them to check and bank account number, and they would bank in the money,” he said in an interview.
From the 636 loan shark cases involving some RM58mil in unpaid debts that he received last year, nearly 70% of the borrowers never met with their lenders face-to-face.
Loan sharks, said Chong, would advise loan defaulters to borrow more money from other loan sharks to cover their previous debt.
“If the borrower still cannot repay, the loan shark will ask them to take even more loans,” he said.
As a result, a person who originally took a RM1,000 loan but then struggled to repay, will find their debt eventually piling up to RM10,000 due to the multiple high interest loans they are forced to sign on.
Loan sharks have also become social media savvy with many advertising their services online.
Some, said Chong, use Facebook to harass borrowers who did not settle their dues.
“They post pictures and wait for the borrower’s response.
“If they still don’t pay up, some even post pictures of the defaulter’s family members to shame them,” he said.
Chong, who has three decades of experience in dealing with such cases, said some people still choose to seek out such moneylenders despite knowing the dangers.