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By Ashley Sim
KUCHING, June 27: Youth, Sports, And Entrepreneur Development (MYSED) Sarawak Minister Dato Sri Abdul Karim Rahman Hamzah says the Federal government’s proposal to raise the minimum debt limit to RM100,000 will only work if youths have disciplined financial management given that many under 35 are bankrupt.
Abdul Karim stated this during the Sarawak Hornbill Team Cup 2023 press conference held today at the Pandelela Rinong Aquatic Centre here.
“That’s why I said that what we receive or our income in a month must roughly equal what we spend during that period.
“Although the proposed increase has the potential to reduce the number of bankrupt youths, it risks leaving the group with debts that exceed their financial means.
“This situation immediately leads to the problem of debt shackles, causing those involved to seek out other options, such as borrowing from loan sharks,” he said.
He continued stating, “For instance, if your monthly income is RM2,000 but your monthly expenses are RM4,000, where will you find the additional RM2,000?
“This situation forces them to borrow, and whatever they borrow must be paid back. It’s similar to borrowing here to pay there. And vice versa.
“This situation can further cause the individuals involved to end up borrowing from ‘ah longs’ (loan sharks).”
According to a Bernama news report yesterday, Deputy Minister in the Prime Minister’s Department (Legal and Institutional Reform) Ramkarpal Singh stated that based on the Malaysian Department of Insolvency (MDI) records, a total of 31,140 youths aged 35 and below have been registered as bankrupts from 2014 to May 2023.
Concerned about the situation, the Federal government has implemented a number of initiatives, including bankruptcy discharge for those declared bankrupt for debts of less than RM50,000 and who meet certain conditions beginning on March 1 of this year.
Ramkarpal explained during a question-and-answer session at the Dewan Negara on Monday (June 26) that the Insolvency Act 1967 was amended in 2020 to raise the bankruptcy threshold from RM50,000 to RM100,000, which indirectly helps to reduce the percentage of bankrupts registered with MDI, including youths.
He stated this in response to Senator Mohd Hasbie Muda’s question regarding the number of bankrupt youths and the government’s efforts to address the problem. — DayakDaily
