THE Malaysian Trades Union Congress (MTUC), the biggest union representing private sector workers in the country, wants banks to quickly come out with clear guidelines for their customers on how they will implement them based on Bank Negara Malaysia’s (BNM) directive.
“The banks must make it clear to individuals and SME borrowers on how the suspended loan/financing repayments/payments will be treated during the moratorium period,” it said in a statement on March 26.
It added that the central bank’s move to impose a loan reprieve for a period of six months from April 1 to Sept 30 will immensely benefit individuals and SMEs that are struggling to pay their dues as a result of the Covid-19 outbreak.
MTUC also said BNM must ensure that individual customers and businesses do not incur any extra interests or payment of any kind in taking up the six-month automatic moratorium on loan payments. Only by ensuring there are no hidden costs will the moratorium be meaningful and have its desired impact.
According to BNM, the automatic moratorium is applicable to ringgit-denominated loans or financing that are not in arrears exceeding 90 days as at April 1.
The moratorium does not apply to credit card balances. For outstanding credit card balances, BNM said customers should be offered the option to convert the outstanding balances into term loans of not more than three years’ duration.
During this period, borrowers/customers with loan/financing that meet the conditions do not need to make any repayment, and no late payment charges or penalties will be imposed.
However, Interest/profit will continue to accrue on loan/financing repayments that are deferred and borrowers/customers will need to honour the deferred repayments in the future.
Nevertheless, HSBC Malaysia, comprising HSBC Bank Malaysia Bhd and HSBC Amanah Malaysia Bhd, is one of the first banks to announce that it will be providing an extra measure for its individual and SME customers beyond the loans or financing deferment measures announced by BNM.
It said the interest for conventional loans as well as profit on Islamic financing would not be compounded during the moratorium period for these customers. — March 26, 2020
