Enhancements to the Targeted Repayment Assistance

November 6, 2020

Kuala Lumpur, 6 November 2020 – Following the announcement by the Finance Minister of Malaysia, YB Senator Tengku Dato’ Sri Zafrul Tengku Abdul Aziz during the 2021 Budget speech on 6 November 2020 and the announcement by Bank Negara Malaysia, ABM member banks are pleased to announce that the ongoing targeted repayment assistance has now been enhanced. The enhancements to the targeted repayment assistance will be available to B40 borrowers who are recipients of Bantuan Sara Hidup (BSH) / Bantuan Prihatin Rakyat (BPR) and microenterprises with loans where the original facility amount is up to RM150,000.

Under this enhanced targeted repayment assistance, eligible borrowers will be offered two options to choose from, i.e. either a 3-month deferment of instalment OR a 6-month reduction in instalments by 50%. Each eligible borrower can only take up one of the above options under this enhanced targeted repayment assistance for each loan, from 1 December 2020 until 30 June 2021. Only loans that were approved before 1 October 2020 and are not in arrears exceeding 90 days as at date of request by the borrower would be eligible for this enhanced targeted repayment assistance. For married couples who are eligible for BSH/BPR based on household income, both husband and wife would be eligible for this package if they have bank loans. Those who opted out of the blanket moratorium (announced in March 2020) are also eligible for this enhanced targeted repayment assistance.

This enhancement to the targeted payment assistance will be effective from 1 December 2020 up to 30 June 2021. The banking industry will provide further updates on details of these enhancements next week. Borrowers may submit their requests and confirmation of the repayment assistance required to their banks via the channels provided by the banks, from 23 November 2020 until 30 June 2021.

All Hire Purchase customers who wish to take up the enhanced targeted repayment assistance will be required to indicate their acceptance of the revised terms and formally confirm the same with their respective banks. This involves the signing of fresh documentation in relation to the hire purchase facility to ensure that the rights of all parties continue to be preserved and protected as required under the provisions of the Hire Purchase Act 1967 which governs the financing granted. Similar process and documentation requirements would apply to customers with fixed rate Islamic financing facilities.

Banks are also offering this enhanced targeted repayment assistance to microenterprises with loans where the original facility amount is up to RM150,000. Such microenterprises must fall within the definition of a microenterprise, according to the Guidelines on SME Definition issued by SME Corporation Malaysia, and would include business entities across all sectors with sales turnover of less than RM300,000 or have less than 5 full-time employees.

Eligible microenterprises that wish to avail of the enhanced targeted repayment assistance must contact their banks via the banks’ official channels to request and confirm the repayment assistance required.

In addition, for M40 borrowers who are registered in the Bantuan Prihatin Nasional (BPN) database and whose household incomes have been reduced due to the pandemic, banks will accept the borrower’s self-declaration as evidence of reduced household incomes to ease the application process for targeted repayment assistance.

The targeted repayment assistance announced previously for those who have lost their jobs in 2020 and have yet to find another job, or whose income has been affected due to the COVID-19 pandemic will still be available. All borrowers, regardless of whether they are recipients of BSH/BPR, categorised as M40 who are registered in the BPN database or not, who wish to discuss their financial repayment options with their banks and obtain advice on the targeted repayment assistance options available to them are welcome to contact their banks at any time, via their banks’ various official channels (e.g. the banks’ websites, branches, customer service hotlines). Our member banks are ready to assist.

Borrowers in areas which are under Conditional Movement Control Order (CMCO) or Enhanced Movement Control Order (EMCO) are encouraged to contact their banks via email, telephone or the banks’ online portals.

We would like to remind borrowers to be wary of scammers and only apply for this enhanced targeted repayment assistance through official bank channels. Borrowers are also advised not to deal with any third parties claiming to be agents/representatives of the banks on matters relating to repayment assistance.

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