KUALA LUMPUR – Business associations, in concert with civil society organisations, are demanding that the government implement a blanket moratorium, saying there is no acceptable reason not to enforce this immediately.
The groups said this should be in effect until year-end or when the country achieves herd immunity against Covid-19, whichever comes later, with the choice to opt out.
They said the targeted moratorium now in place has proven to fail to assist businesses and individuals.
The present opt-in policy benefits only certain groups, and the moratorium period is for a maximum of just three months. Eligible borrowers can also opt for a 50% loan repayment reduction over six months.
In a joint statement today, the groups said the blanket moratorium must be zero-interest and open to all individuals and businesses, while bank charges for restructuring and rescheduling exercises should be waived.
This kind of moratorium can be implemented, they said, taking into consideration the fact that Putrajaya has bailed out the financial system to the tune of RM70 billion, with banks being the main beneficiaries.
The groups also said banks have the financial capability to implement their proposal, noting that Malaysia’s top eight local lenders collectively made a RM93 billion profit in the last three years.
They added that a memorandum calling for a blanket moratorium has been sent to Prime Minister Tan Sri Muhyiddin Yassin, the Finance Ministry and Bank Negara Malaysia, but there has been no response.
The proposal is supported by over 130 associations representing some one million businesses nationwide, and 3.9 million self-employed individuals and micro-business owners.
Targeted moratorium makes no sense, unfair to majority
In a virtual press conference elaborating on the groups’ call, Malay Economic Action Council senior fellow Ahmad Yazid Othman said it is unfair to force businesses to continue paying loans when the majority are not allowed to operate.
“We are not given the option. It’s not like we are lazy or do not know how to do business. But, we are forced to stay home.
“There’s no reason for the banks to take advantage of us by aggravating our struggles and forcing us to repay loans,” he said, pointing out that most in the domestic industry have not been given government approval to continue operations.
Movement for Monetary Justice Malaysia chairman Prof Datuk Ahamed Kameel Mydin Meera said it makes no economic sense for Putrajaya not to introduce a blanket moratorium, which he said will actually spur growth.
Implementing it will ensure that future tax collection from businesses is not affected, as they will be financially capable of restarting operations once the pandemic is over, and there will be more cash in hand for the rakyat to spend, in turn stimulating the economy, he said.
Kameel noted that banks will not lose out by having a blanket moratorium, as the amount collected will remain the same despite slightly delayed repayments.
Businesses will collapse, unemployment will increase without it
Gerakan Ekonomi Malaysia president Armin Baniaz Pahamin said many people, even those in the M40 and T20 groups, have seen their incomes affected since the first virus lockdown was imposed in March last year.
“Without a blanket moratorium, many people will go bankrupt and more businesses will fold.”
Industries Unite co-founder Datuk David Gurupatham warned that not implementing such a moratorium today will lead to more businesses collapsing, affecting thousands of jobs.
He said based on his observation and information received, businesses are shuttering much faster under the current lockdown than during previous rounds of movement controls.
“The fact that all these associations have come together here today says something. At the moment, banks are being opportunistic, while the rakyat are being squeezed.”
Bumiputra Retailers’ Organisation president Datuk Ameer Ali Mydin said the consensus among businesses and the people is that the targeted moratorium has not been effective in addressing their plight.
Slamming banks’ refusal to implement a blanket moratorium, he suggested that their workers be excluded from the policy when the government does enforce it.
National Union of Bank Employees general secretary J. Solomon, meanwhile, said the onus is on the government to compel banks to introduce a blanket moratorium. – The Vibes, June 11, 2021
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