The high cost of living and poor financial planning has been cited as among the main reasons Malaysians fail to pay their debts or have debt issues.
Deputy Finance Minister I Datuk Seri Ahmad Maslan said according to the data from the Credit Counselling and Management Agency (AKPK), 38.9 per cent of people stated a high cost of living while 36 per cent attributed it to poor financial planning.
"Forty-one per cent or 162,922 of them are between 30 and 40 years old, while in terms of marital status, 77 per cent of them are married," he said during his visit to AKPK today.
The figures are based on the data collected by the agency as of February this year from the 420,000 participants of its Credit Management Programme (PPK).
Ahmad Maslan said throughout 2014 until May this year, a total of 31,140 youths have been registered as bankrupt.
In terms of annual income, he said one-third of those having problems with their debts are individuals who earn an annual income of less than RM24,000 or RM2,000 and below per month.
Other reasons include failure or slowdown in business (11 per cent), job loss or retrenchment or loss of breadwinner (8.8 per cent), high medical expenses (4.9 per cent) and other reasons (0.4 per cent).
“If they do not seek professional help, the problems will continue to get bigger,” he said adding that they should seek AKPK’s advice before the problem gets worse.
Ahmad said AKPK’s financial advisory and credit management services are free and the agency did not appoint agents or third parties to represent the body.
AKPK has also assisted 1,400 micro, small, and medium enterprises to tackle their credit problems through its Small Debt Resolution Scheme (SDRS) with RM2.6 billion in debt restructuring financing, he said.
AKPK chief executive officer Azadin Ngah Tasir said there was an increase in the number of individuals seeking advice from AKPK but only 30 per cent of them took part in the PPK while the rest managed to solve their debt problems without enrolling in the programme.
More than 1.2 million individuals have sought AKPK’s advisory services since its inception in 2006 until February this year and of the figure, 420,000 individuals enrolled in the PPK with a maximum tenure of 10 years and about RM2.5 billion debt arrears were resolved.
AKPK has 11 branches across the country and its resources and services, including the POWER Portal! and Resource Centre can be accessed at www.akpk.org.my.
Source: BERNAMA News Agency
