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KUALA LUMPUR: Payment assistance will continue to be available this year and through 2021 for borrowers whose income has been affected by the Covid-19 pandemic.
In a statement, Bank Negara said that borrowers facing challenges have generally requested reductions in monthly payment installments or an extension of the moratorium, depending on the circumstances.
“Borrowers who have declined payment assistance for now can still apply for specific assistance during 2020 and 2021 if their financial circumstances change,” he said.
Bank Negara said the scale of directed repayment assistance was unprecedented in Malaysian banking history.
It ensured that assistance would continue to be provided to borrowers from different income groups, with particular regard to B40 households, microenterprises and borrowers affected by movement restrictions.
A specific approach to reimbursement assistance expands relief measures in a more sustainable way, while also fueling economic recovery.
He said that many borrowers have now started to resume payments. For this group, resuming repayments would be in their interest as this would lower the total cost of borrowing. If your financial circumstances change in the future, specific payment assistance would still be available.
He also said that borrowers who require assistance at this time can customize their repayment plans based on what they can afford.
“If their circumstances are further questioned in the future, they would have more recent repayment records to facilitate further assistance from the banks,” he said.
The financial resources of the banking system can be prioritized to help those most affected by Covid-19. As more borrowers who can afford to repay do so, more help can be offered to borrowers in need.
The public, as depositors, expects banks to meet their fiduciary obligation by managing these funds prudently and using them to lend the economy for productive purposes, Bank Negara said.
In addition, banks raise capital from institutional funds, such as those that manage Malaysian pensions, retirement funds and investments. Therefore, it is important to preserve a healthy credit culture where borrowers who can afford it will.
Bank Negara said more than 640,000 requests for payment assistance have been received, with an approval rate of around 98%. The types of packages that banks offer reflect the borrowers’ financial needs and circumstances.
Of those approved, he said that 40% were granted an extension of the moratorium. These mainly consisted of people who have recently become unemployed, as well as companies in sectors that may still be experiencing significant operational limitations caused by the pandemic.
The other 60% received a reduction in fees. Borrowers who have requested a reduction in installments include those in the B40 group. These fee reductions put individuals and SMEs on the path to beginning to repay their loans, at levels they are comfortable with.
Among people who have applied for payment assistance to date, approximately 50% have a monthly income of RM5,000 or less.
Meanwhile, 28% are those with a monthly income between RM5,000 and RM10,000.
Borrowers in other segments in need of assistance are also being supported, including those with variable incomes and those employed in the worst affected sectors, such as tourism.
“Requests for payment assistance any time before June 30, 2021 will also not appear in the borrower’s CCRIS records.
“There are no processing fees or charges associated with requests for payment assistance for individual borrowers and SMEs. To obtain specific assistance, borrowers must apply directly to their respective banks, ”he said.
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