Covid-19 Movement Control Order: How to Defer Loan Payment?

Do you know? According to the Bank Negara of Malaysia Press Release a new financial assistance program “Defer Loan Payment Moratorium” had been introduced to help the affected individual and SME during the Movement Control Order “MCO” Period.

Covid-19 Movement Control Order: How to Defer Loan Payment?

The borrowers can defer their loan payment [including Housing Loan, Car loan, etc.] starting from 1 April 2020 to 30 September 2020 [Six months].

This event is applied to everyone regardless you are individual, small business or even big business.

Which Banks offer this deferment package?

All licensed banks, licensed Islamic banks and prescribed development financial institutions (DFIs) regulated by BNM will offer this deferment flexibility. Borrowers/customers that meet the eligibility criteria can avail themselves to this flexibility automatically.

How to apply?

“Defer Loan Payment Moratorium” is an automatic postponement. All individual and SME / Financing (excluding credit card) will automatically qualify for the deferment for six months to help borrowers who are facing financial difficulties due to Covid19 and Movement Control Order (MCO).

Loan/financing qualifies for the deferment

For individuals and small and medium enterprises (SMEs), the deferment in conventional loans or Islamic financing repayment obligations (except credit cards) are automatically effected by banks and development financial institutions (DFIs) if the loans/financing meet these criteria:

  • Not in arrears exceeding 90 days as at 1 April 2020;
  • Denominated in Malaysian Ringgit.

You don’t have to provide proof that you are affected by COVID19. There is no impact on CCRIS records during the deformation period. The loan payment will constitute automatic postponement.

Read also: PRIHATIN Salary Subsidy Programme: How to apply RM600 Salary Subsidy?

Interest charged?

For the deferment interest, it will depend on your Bank. Some bank will charge ordinary interest on the deferred payments. It means that you need to pay more interest by deferring the loan. However, some bank did not charge compounding interest.

For more information regarding the Compounding Interest, you may need to call your banker for more information regarding the payment deferment.

If you having cash flow issue during the MCO period, you may consider taking advantage of this Moratorium to free up your cash flow.

This package is to provide some relief to individuals and businesses who face temporary financial constraints arising from the COVID-19 pandemic. It will help individuals and businesses facing financial adversities to cope with challenges during this period. Loan/financing repayment resumes after the deferment period.

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