MALAYSIA’S household debt stood at RM1.65 trillion as of the end of March 2025, equivalent to 84.3 per cent of the nation’s gross domestic product (GDP).
However, Deputy Finance Minister Lim Hui Ying highlighted that the value of household financial assets exceeds the total debt, indicating that the public’s overall financial position remains strong.
“Household debt should be viewed alongside household financial assets, which are significantly larger.
“On aggregate, household financial assets continue to exceed debt by 2.1 times, providing a solid buffer for households,” she told the Dewan Rakyat today as reported by Bernama.
Lim was responding to a supplementary question from Datuk Awang Hashim (PN-Pendang), who inquired about the debt-to-GDP ratio.
She said that regarding household debt, the government and Bank Negara Malaysia are always committed to assisting credit users who face financial difficulties.
In response to the original question posed by Datuk Mohd Shahar Abdullah (BN-Paya Besar), who asked whether the government has regulatory plans for credit services to ensure stronger consumer protection, Lim said that loans approved by financial institutions are subject to the Policy Document on Responsible Financing.
This document was issued by Bank Negara Malaysia (BNM) and has been in effect since 2012.
Lim explained that through the implementation of this policy document, the debt service ratio (DSR) for households remains within prudent levels, with the median DSR for outstanding loans at 34 per cent, while the median DSR for newly approved loans is 41 per cent in 2024.
“The DSR maintained within these prudent levels serves as an adequate buffer for households to meet their debt obligations,” she said.
Meanwhile, Lim said that the Credit Counselling and Management Agency (AKPK) also provides advisory services and assistance in financial management and loan restructuring.
The deputy minister added that AKPK has successfully helped more than 64,000 borrowers fully settle their loans through its Debt Management Programme, while nearly 270,000 participants remain actively engaged in their financial recovery journeys under this programme. – July 29, 2025
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