Housing and Local Govt Ministry says not involved in viral ads for 'EPF loan' schemes

PUTRAJAYA (Bernama): The Housing and Local Government Ministry (KPKT) denies any involvement in advertisements offering Employees Provident Fund (EPF) loan schemes that have gone viral on social media and websites.

This comes following advertisements targeting EPF account owners using the name of licensed moneylenders or community credit companies registered under the Ministry.

In a statement Wednesday (Oct 26), it said the advertisement offers loans with interest rates between 5% and 7% per month, far exceeding the interest rate set in the Moneylenders Act 1951 (Act 400) which is a maximum of 1.5% per cent per month or 18% per cent per year for individual loans.

The advertisements also contained suspicious loan information intended to deceive the public including a loan scheme with no monthly payment with only an EPF statement required for a loan eligibility check, with a target of individuals who are aged between 48 and 55 years old.

The Ministry, which is taking a serious view of the advertisements, stressed that dealings with community credit companies can only be done on registered and legal business premises.

"People need to get confirmation of the information from the Ministry first before any agreement is made and not sign any blank agreements," it said.

The Housing and Local Government Ministry said it feared the advertisements would affect the image and credibility of the community credit sector and have negative implications for the public, especially borrowers who are caught up in such irresponsible activities.

The ministry said any licensed community credit company found to be involved in "misleading" loans or charging high interest rates could be prosecuted under Section 17A of Act 400 which provides for a maximum fine of RM20,000 or imprisonment not exceeding 18 months or both.

Any related complaints can be submitted through the Ministry's Integrated Complaints System, namely aduan.kpkt.gov.my, i-KrediKom mobile application, Community Credit Control Division (BKKK) Hotline at 03-8891 4694/4690 or in person at the Ministry's Complaints Counter on Level 1 of its premises in Putrajaya. - Bernama