PUTRAJAYA: The public should turn to licensed moneylenders instead of loan sharks when seeking financial assistance, says Housing and Local Government Minister Nga Kor Ming (pic).
He said that licensed moneylenders registered under the Moneylenders Act 1951 (Act 400) are required to adhere to regulations set under the Act.
“Under the Act, the interest rate for unsecured loans must not exceed 18% per annum, and for secured loans, it must not exceed 12% per annum.
“Licensed moneylenders are also prohibited from charging interest that exceeds the principal amount.
“The Act also prohibits licensed moneylenders or their representatives from visiting the borrower’s home or workplace to collect loan repayments,” he said in a statement, adding that the public could also report any violation of the law to his ministry or the police so that action can be taken immediately.
“The public is also advised to verify the status of licensed moneylenders registered with the ministry by calling directly or through the i-Kredikom mobile application.”
Nga also urged the police to take firm and thorough action to put an end to loan shark operations once and for all.
“Ah long or loan sharks often take advantage of those in financial distress by trapping them in a violent debt cycle involving outrageous interest rates, harassment and violence.
“We urge the police to take firm and comprehensive action to eradicate such activities down to their roots,” he said, adding that his ministry takes such issues seriously.
He was commenting on a fire incident that destroyed three houses in Taman Tasek Gelugor, Penang, on June 24, which was believed to be linked to loan shark activity.
The fire reportedly broke out at around 4.50am and damaged three homes but caused no injuries.
