Bank Negara Malaysia (BNM) has announced that repayment assistance will remain available for borrowers, including those who have previously declined it. According to the central bank, borrowers would still be able to apply to their respective banks for targeted assistance throughout 2020 and into 2021 if their financial circumstances change in the future.

The month of October saw the country transition into a targeted moratorium after the blanket automatic loan moratorium, which began from April 1, ended on September 30. Prime minister Tan Sri Muhyiddin Yassin previously announced a three-month extension to the bank loan moratorium (October 1 to December 31), albeit with some changes from the first time around. Following BNM’s recent announcement, this assistance looks set to continue into next year as well.

In the case of hire purchase loans, which are usually taken on to purchase cars, banks will be able to provide the option of rescheduling your instalments accordingly, in accordance to the Hire Purchase Act. Unlike during the initial moratorium period (April 1 to September 30), where borrowers did not need to pay anything for six months, the newer targeted repayment assistance will see your loan being restructured instead.

For example, the loan term can be extended for a revised monthly instalment amount and possibly with interest as well (check with your respective banks first). Certain banks appear to allow further deferment but with terms and conditions attached, and as these plans are individualised to suit each customer’s situation, various factors such as financial condition, affordability and account status will be taken into consideration first.

In an official release, BNM said the scale of targeted repayment assistance is “unprecedented in Malaysia’s banking history.” It adds that while borrowers have access to assistance, special consideration will be given to households from the B40 category, micro businesses as well as those affected by movement restrictions.

For borrowers who require assistance at this time, they will be able to discuss with their respective banks on customising their repayment plans based on what they can afford. With this, should their circumstances become more challenging in the future, they would have more recent repayment records to facilitate further assistance by banks.

Meanwhile, borrowers who are now able and have started to resume payments are encouraged to continue doing so, as this would not only reduce the overall cost of borrowings, but also allow assistance to be channelled to those that need it. However, should their financials take a turn for the worse, targeted repayment assistance would still be available.

If you do need repayment assistance, BNM urges affected borrowers to come forward and apply for it with their banks using proper channels. It states that banks are required to respond to such applications within five days for individual borrowers and within 14 days for SME borrowers – those that do not receive a response within these timeframes should contact BNMTELELINK.

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The central bank also assured borrowers affected by the conditional movement control order (CMCO) or enhanced movement control order (EMCO) that they can expect a prompt and seamless process even as banks in affected areas continue to operate under appropriate SOPs. For those unable to have face-to-face engagements or furnish documents due to movement restrictions, they can contact their banks via website, phone or email.

Individual and SME borrowers who need advice and assistance, including options for debt restructuring, can also contact AKPK (Agensi Kaunseling & Pengurusan Kredit). For borrowers that were already facing financial difficulties prior to the pandemic, a moratorium extension is not a sustainable solution, says BNM, and they should approach AKPK for assistance.

The central bank also stated that applications for repayment assistance made any time before June 30, 2021 will also not appear on a borrowers’ CCRIS records, and there are no processing fees/charges associated with them for both individual and SME borrowers.

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