Banking sector to continue assisting borrowers facing difficulties, says PM

PETALING JAYA: The banking sector will continue to assist borrowers who are facing financial difficulties amid the Covid-19 pandemic, says Datuk Seri Ismail Sabri Yaakob.

The Prime Minister said borrowers who are new or still found it difficult to get employment, especially from the B50 group, should be supported as much as possible until they are able to stand strong again.

“The Government, through the Malaysian Insolvency Department, has increased the bankruptcy threshold to RM100,000 to provide protection to those who may still be unable to survive financially due to the effects of the pandemic.

“To support the B50 community, the banking industry together with the Credit Counselling and Debt Management Agency (AKPK) is actively implementing the Financial Management and Resilience Programme (Urus) for eligible borrowers who are affected by the Covid-19 pandemic.

“Under Urus, borrowers will get interest or profit exemption for a period of three months; deferment of loan payments or moratorium as well as other options including reduction of instalments for a period of up to two years to help manage the overall debt according to the ability of the borrower; and development support, education and advisory services to help manage finances and be more resilient including opportunities to supplement income and obtain other support,” he said in a statement Friday (Dec 17).

Ismail Sabri added that borrowers would be provided with comprehensive assistance, including a personal finance plan tailored based on their respective financial capabilities, taking into account all types of loans with banking institutions under their name.

“This is to ensure more meaningful long-term assistance to borrowers who need to restore their financial situation in line with the economic recovery.

“The Government also noted that the banking sector has implemented Urus in a transparent and fair manner to assist B50 borrowers with a household income of up to RM5,880 as well as job losses or loss of income in excess of 50% of household income as a result of the pandemic.

“Eligible borrowers who wish to apply for facilities under Urus can contact their respective banks before Jan 31, 2022,” he said.

Apart from that, Ismail Sabri said for micro-entrepreneurs, RM1.8bil had been allocated through TekunNasional, Bank Simpanan Nasional and Agrobank which provide financing at a zero percentage rate for at least six months for loans up to RM75,000, and an immediate moratorium of between six to 12 months, subject to terms and conditions.

“The government noted that there are still many people, especially in the B40 group, who need support.

“In this regard, under Budget 2022, the Government’s efforts to ensure the well-being of the people are comprehensive and include various initiatives.

“These include an allocation of RM8.2bil for Malaysian Family Assistance; RM2.4bil for assistance under the Social Welfare Department; RM450mil for early schooling assistance; RM400mil for supplementary food plans including daily milk supply for poor children; RM450mil for the Malaysian Family Student Device initiative; and RM4.8bil for the MyStep Job Guarantee and Training program to provide 600,000 job opportunities.

“The Government also emphasised social protection for the B40 group.

“Through Budget 2022, among the improvements in social protection initiatives include the Tenang protection voucher facility which was increased to RM75 as well as continuing the additional Job Seeker Allowance and increasing the insured salary ceiling from RM4,000 to RM5,000 to improve social security coverage for the nine million workers covered by Sosco,” he said.

Meanwhile, the Prime Minister welcomed the efforts of the banking sector to continue supporting and assisting borrowers facing financial difficulties for loan restructuring.

“The Government has taken note of the banking sector’s efforts.

“Banks are asked to continue to assist borrowers facing financial difficulties to repay all their loans and defer legal action against borrowers who fail to repay debts.

“Borrowers who still need assistance are advised to immediately contact their respective banks to discuss appropriate restructuring and rescheduling options.

“Although the bankruptcy rate has dropped by 50% after the economic sector began to open up gradually since last October, the Malaysian economy will take time to fully recover,” he said.