Malaysian Trades Union Congress (MTUC) secretary-general J Solomon expressed concern over Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz’s alleged lack of urgency in deciding on the extension of the loan repayment moratorium.
He said Tengku Zafrul’s comments in Parliament yesterday that banks could decide the matter suggested that the former banking executive was biased towards the industry.
Solomon argued that Tengku Zafrul and Bank Negara Malaysia should instead work together and compel banks to extend the moratorium automatically for those in the B40 and M40 groups as well as struggling businesses.
“It appears that the finance minister has chosen to display his bank-friendly stance in leaving it to them to rearrange with borrowers the terms and conditions of the repayment of their loans,” Solomon said in a statement.
“What appears to be clear is that come 1 Oct the banks have the green light to collect their dues at their total discretion.
“It must be noted that Tengku Zafrul’s approach in encouraging the people and businesses to talk directly to the banks is hardly a decision that mitigates the problem. This option has always been there even if he did not say it.
“Saying that the people should talk to banks and the government would do likewise only shows a lack of decisive leadership on his part to help people and businesses need from the banking sector in this most trying of times.”
The six-month bank loan moratorium began in March and was set to end in September. However, many are still struggling to repay their loans due to the Covid-19 pandemic.
An additional six-month extension on repaying loans will help those who have lost their jobs or are suffering from a dip in income due to closures of many economic sectors due to the movement control order that started in March and is not in its fifth phase, Solomon said.
According to Solomon, the most likely outcome would be the banks seeking payments from the 800,000 people officially unemployed till May 2020 as well as struggling businesses.
He said Tengku Zafrul detached from reality in his justification that most economic sectors have reopened, this meant businesses and workers’ financial situation is back to normal.
“It is too simplistic and assumes without adequate studies. Such a statement implicit or otherwise really reflects a deep disconnect between the minister and the reality on the ground.
“Until international trade is restored and the Malaysia’s main trading partners such as China and the United States are able to revive their economy to pre-Covid 19 levels, the local economy is expected to also remain in the doldrums, meaning financial assistance such as the moratorium on loan repayments must not be yanked away from the rakyat.
“They need an additional six-month respite as clearly the country needs at least that much time and well beyond to get the economy ticking again while awaiting to go full throttle once the Covid-19 vaccine makes it to our shore,” he added. – MMO