THE issue of bank loan moratorium has resurfaced following the implementation of the full lockdown to curb the spread of Covid-19.
Calls are currently mounting for the bank loan moratorium to be automatically extended to all borrowers and not just the B40 group, as announced by the government under the Pemerkasa Plus stimulus package.
I understand the rationale for wanting the moratorium to be extended to the M40 group. Many in this group have also lost their jobs or had their incomes slashed due to the economic turbulence of the pandemic.
I should know because I have gone through the bitter experience. When I was let go from my job in November last year, I was at a loss. My first reaction was to think about how I was going to pay for my housing and car loan, not to mention providing for my young family.
At that time, Bank Negara’s automatic loan moratorium had just expired (September 2020).
Nevertheless, I picked up the phone, called my bank and asked for my loan to be restructured.
After a few hiccups and submission of the necessary documents and correspondence, my application was approved.
My point is that being denied an automatic loan moratorium is not the end of the world. One just needs to take the initiative to call the bank and ask for the moratorium to be extended or the loan to be restructured.
According to the Association of Banks Malaysia, over 90% of such requests are approved.
With banks continuing to earn handsome returns despite the pandemic, I believe many of them do have the buffer to provide flexibility to retail borrowers, if only for goodwill purposes. Just pick up the phone and call the banks, guys!
I am lucky that I landed a new job not long after and I went back to servicing my loans as before. From the financial standpoint, the faster I settle the debt, the less interest I have to pay.
In my opinion, the question of being denied an automatic loan moratorium is not an issue, so please don’t turn it into one.
Batu Kawan, Penang