KUALA LUMPUR: The government is working on the formulation of a Consumer Credit Act (CCA), with the aim of strengthening protection for credit consumers in Malaysia.
The CCA seeks to provide a comprehensive framework for regulating the conduct of entities carrying out the business of providing credit or credit services to such consumers, with an immediate focus on those that are not currently subject to direct regulation by any authority. This includes the regulation of new forms of credit such as “Buy Now Pay Later” providers.
The CCA will pave the way for the establishment of the Consumer Credit Oversight Board (CCOB) as an independent competent authority to oversee consumer credit providers and credit service providers.
The public consultation is the first of a two-part consultation. It provides an overview of the current landscape of the consumer credit industry in Malaysia, its challenges, and proposed reforms to better protect individuals and small businesses in their dealings with credit providers and credit service providers.
The reforms will be implemented in phases under a proposed multi-year programme to deliver consistent standards of protection for credit consumers and support the orderly development of the credit industry in Malaysia.
The CCOB task force seeks feedback on the proposed regulatory and authorisation framework, as well as areas that will be addressed in the legislation to promote high standards of professionalism and fair conduct of credit providers and credit service providers. Part 2 of the consultation paper, targeted to be issued in the fourth quarter of this year, which will provide further details on authorisation, governance, and conduct requirements that will be applied to credit providers and credit
service providers.
