Loan moratorium extended by 3 months for jobless, reduced monthly instalments for those with pay cuts

Prime minister Tan Sri Muhyiddin Yassin has announced a three-month extension to the bank loan moratorium, which was supposed to be for six months ending September 30. However, this bantuan is not across the board, but only for those who have lost their jobs this year, without getting a replacement job.

The PM said in a live address that after the three months (which will be the end of 2020), it will be up to the banks to grant further extension based on the borrowers’ situation.

For those who still have jobs, but have had pay cuts due to Covid-19, monthly instalments will be reduced in tandem with the quantum of pay cut – for instance, 20% pay cut, 20% reduction from the instalment amount, and so on. This is for home loans and personal loans only, and will be in place for at least six months. Extensions might be granted based on the pay situation of the borrower.

As for small medium enterprises (SMEs) and individuals who run their own businesses, the type of assistance available from the banks include paying only the interest for a certain period, lengthening the tenure of the loan to reduce the monthly instalment, or other deductions until the financial situation of the borrower stabilises.

As for hire purchase loans, which are the type we take on to purchase cars, banks will also give the option of rescheduling your instalments accordingly, in accordance to the Hire Purchase Act. For example, your loan tenure can be extended in exchange for lower monthly payments.

Muhyiddin says that all these measures are set to benefit three million individuals and SMEs. If you fall under the above categories and are entitled to the this targeted moratorium, contact your banks and apply from August 7.

Looking to sell your car? Sell it with Carro.

Learn more: COVID-19