KUALA LUMPUR: The Finance Ministry and Bank Negara Malaysia have been urged to look into extending the maximum loan tenure to increase disposable income and prevent bankruptcy.
Congress of Unions of Employees in Public and Civil Services (Cuepacs) president Datuk Adnan Mat said borrowers would then have the option of having lower loan repayments as they deal with the impact of the Covid-19 pandemic and higher cost of living.
He suggested for the maximum tenure of personal loans to be extended from 10 to 20 years, according to Bernama.
“This could boost the economy and help people deal with financial pressures. It also gives a second chance to those having to go through bankruptcy.
“At the same time, the operations of credit cooperatives and financial institutions regulated by Bank Negara Malaysia can grow again,” he said in a statement yesterday.
Adnan said the total number of bankruptcy cases handled by the Insolvency Department from 2018 until 2022 was 49,133 cases, and that personal and vehicle loan debt were among the main reasons for Malaysians going bankrupt.
He, however, noted that bankruptcy cases among civil servants, at 9.06% or 4,449 people, were not too worrying.
“Exposure to good financial management that the public service has inculcated in its members has increased awareness … so as not to get entangled in debt,” he said.