KUCHING: The public are advised against borrowing from illegal moneylenders in order to avoid falling into financial ruin.
“Please do not make any loan transactions with illegal moneylenders despite how desperate you are during the Covid-19 pandemic, to avoid your life being ruined at the end of the day,” warned a financial advisor of Credit Counselling and Debt Management Agency (AKPK), Farhanna Omar.
She explained that the primary reason people borrow from moneylenders was due to being in financial distress and having no emergency fund as a safety net.
“The moneylender industry is frequently unlicensed and illegal, with very high interest rates, we usually hear violent stories from their victims.
“Loans that are not effectively managed will cause problems at work and even worse, will impair family relationships, so please don’t get started on this,” she said.
Farhanna shared that several licenced lending institutions are not affiliated with banks but still provide financial assistance during this difficult time.
“There are other options such as cooperatives and licenced financial institutions available to the public, but we still need to study the details of the loan before agreeing to it due to the differing interest rates.
“The government has also launched several caring assistance packages targeted at individuals or Small Medium Enterprises (SMEs) so those who are having troubles with their businesses may review the packages to see if there are any assistance that is eligible to be applied for.
“However, if the problem was caused by an existing loan, then they should go back to the lender and try to negotiate the rescheduling of their loan payments,” she added.
She urged members of the public to contact the Credit Counselling and Debt Management Agency (AKPK) at www.akpk.org.my if they are unsure how to refer to their lender.
AKPK assists in rescheduling for loans while providing free services aimed at meeting the demand of Malaysians for financial advice.