Banks have now agreed to waive the additional interest or profit charges imposed on installments for hire-purchase loans for the six-month moratorium announced by the government.
Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said his ministry has reached an agreement with the banking industry on this matter, following the government’s call to the industry to waive the additional charges.
“It has been agreed that the amount of monthly instalment payments will not change for hire-purchase (conventional and shariah-compliant) borrowers throughout the financing period.
“This also means there will be no additional charges imposed during the moratorium (deferment) period,” Zafrul said in a statement today.
He said borrowers are therefore required to resume paying their instalments as usual, based on the terms of agreements with their respective banks including with an extension of six months in the repayment period, if they chose to take up the moratorium.
“Further information can be obtained from the respective banks.
“The government hopes this decision will be able to ease the people’s burden during these challenging period,” Zafrul added.
The minister’s announcement today is expected to put a stop to the heated debates that started over the weekend, on whether banks should impose additional charges for the six-month period from April 1 to Sept 30.
Some quarters, including the Malaysian Trades Union Congress, accused Bank Negara Malaysia and commercial banks of being inhumane and placing more focus on profit than helping the rakyat.
They pointed out that the moratorium was introduced because some borrowers are facing a hard time paying their loans during the Movement Control Order.
Zafrul subsequently suggested that the financial institutions waive any accrued interest or profit imposed with respect to the moratorium period.
On Sunday (May 3), Agrobank, a development bank under the purview of the Minister of Finance Inc, announced it would do exactly that for all eligible individual and small- and medium enterprise customers, during the six-month period.