Kuala Lumpur, Thursday, 18 January 2018 – In response to a recent article published in an online portal, Free Malaysia Today titled “Easy access to loans contributes to bankruptcy, says consumers group”, The Association of Banks in Malaysia would like to state that loans approved by our member banks are assessed stringently and in accordance to their internal approving guidelines and procedures.

Our member banks assess loan applications based on the eligibility of the applicant and repayment capability among other factors. Rigorous verifications including checks with the Central Credit Reference Information System (CCRIS) and various credit report agencies are performed before approval for loans applications are granted. Banks adhere to responsible financing practices in providing loans. This is to avoid exposing both the bank and the borrower to increased credit risks.

Our member banks also view fraud very seriously and if falsifications are detected, banks would take immediate steps to address the issue and reject the application.

Members of the public are reminded to practise prudent spending within their means to avoid being caught in a financial quandary. This also applies to having careful planning with regards to using facilities such as debit cards and other payment cards. A debit card is a payment card where the transaction amount is deducted immediately from your savings and/or current account, upon authorisation. ATM cards in Malaysia also function as debit cards and allow cardholders to make purchases at point of sale terminals. Debit cards are a convenient alternative to carrying cash. If there are insufficient funds in the card holder’s bank account to meet the payment, the payment transaction would be declined. In addition, debit cardholders have the option to set their preferred limits for transactions at point of sale terminals and for ATM withdrawals.

Our member banks remain committed to adhering to the guidelines of responsible financing and are continuously supportive in providing access to financing to eligible applicants.