Banks grant six-month automatic moratorium on loans

PETALING JAYA: Banking institutions will grant an automatic moratorium on all loan/ financing repayments/payments, principal and interest by individuals and SME borrowers for a period of six months from April 1, 2020.

This is according to a letter sent out by Bank Negara Malaysia (BNM) to banks, Islamic banks, investment banks and development financial institutions.

However, the central bank had not verified the information.

The moratorium does not apply to credit card balances.

The move is to ease the cash flow of SMEs and individuals that are likely to be most affected by Covid-19.

The automatic moratorium is applicable to loans/financing that are not in arrears exceeding 90 days as at April 1, 2020.

For outstanding credit card balances, banking institutions will offer borrowers the option to convert them into a term loan/financing of a tenure of not more than three years with an effective interest rate of not more than 13% per annum.

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