KUCHING, May 1: SUPP Youth secretary-general Milton Foo has urged Bank Negara Malaysia (BNM) to review the decision to allow banks to charge interests on loan and financing repayments that were deferred for six months.
“It is a difficult period for people amid the Covid-19 pandemic. Most if not all businesses in the country have suffered a huge economic impact,” he said in response to BNM latest announcement, which sparked confusion and anger among the public.
Foo, in a statement, pointed out that the purpose of the moratorium was meant to mitigate and ease the financial burden of the people and business sectors affected by the Covid-19 outbreak.
“This is the time where giant corporations such as banks should rise to the occasion to fulfill societal expectations and social responsibilities to contribute and help the nation and its people to overcome the financial difficulties arising from the pandemic,” he added.
He appealed to the federal government, Ministry of Finance, as well as BNM to waive the interests on the deferred loan repayments during this hard time for the benefit of the borrowers across the board.
Yesterday (April 30), BNM issued a statement requiring banking institutions to take appropriate steps to ensure that borrowers are provided with clear information on the process and changes to the terms of their agreements on deferring their loan or financing payments under the moratorium.
The statement reiterated that interest/profit will continue to accrue on deferred payments and advised borrowers to consider this in deciding whether they wish to take up the moratorium.
The announcement has since sparked confusion among the public as it was initially understood that there would be no additional interest on deferred hire purchase (HP) loan payments.
Today, BNM maintained that there were no changes to the policy for the six-month moratorium on HP loan repayments and fixed-rate Islamic financing.
Its deputy governor, Jessica Chew Cheng Lian, told Free Malaysia Today that no one needed to apply for the moratorium but the banks have to comply with the Hire Purchase Act 1967 and obtain an indication of agreement from customers.
BNM Prudential Financial Policy director, Cindy Siah Hooi Hoon, said the central bank had never stated that interests would be waived, adding that it had made it clear previously that interest would continue to accrue.
Siah said BNM had also emphasised that borrowers needed to understand how their repayments would change if they were to take up the moratorium offer. — DayakDaily