KUALA LUMPUR: Banks have enough capital buffer to implement the loan moratorium extension as announced by the government, the Dewan Rakyat heard.
Deputy Finance Minister I Datuk Abdul Rahim Bakri said that a total of RM66bil out of the RM100bil allocation had been used by banks so far under the moratorium assistance through the economic stimulus package.
"Each moratorium extension decision is regulated by Bank Negara Malaysia and entails the involvement of the Association of Banks in Malaysia," he told Datuk Mohd Salim Sharif (BN-Jempol) during Question Time on Wednesday (Aug 12).
Mohd Salim had asked the Finance Ministry if banks were able to extend the loan repayment moratorium amidst challenging economic outlook.
Abdul Rahim also noted that the loan moratorium extension on a targeted basis will help prevent legal action against those who are unable to service their debts.
"The current process we are doing is to give out targetted moratorium extension.
"It means that many will benefit from this and the act of taking legal proceedings against borrowers will be avoided.
"That is why, for borrowers who are facing a little difficulty (to service their loans), they can visit the Credit Counselling and Debt Management Agency (AKPK).
"While for small and medium enterprises (SMEs), they can visit the Small Debt Resolution Scheme agency to get advice on the matter
"That is why I believe such legal proceedings can be avoided," he said.
On July 29, Prime Minister Tan Sri Muhyiddin Yassin announced a targeted extension for the moratorium on bank loans for those who either lost their jobs or had pay cuts this year as a result of the Covid-19 pandemic.
Muhyiddin also said the banks had given their commitment in the form of several measures to assist borrowers, regardless of whether they were individuals or small and medium enterprises (SME).
The Prime Minister said these measures were expected to benefit up to three million individuals and SMEs.