Association of Banks refutes easy access to loans claim

PETALING JAYA: The Association of Banks in Malaysia (ABM) stressed that loans approved by its member banks are assessed stringently and in accordance to their internal approving guidelines and procedures.
It was responding to an online portal's news report on the Consumers Association of Penang's concerns over rising bankruptcy cases in Malaysia following an easy access to loans.
"ABM would like to state that our member banks assess loan applications based on the eligibility of the applicant and repayment capability, among other factors. Rigorous verifications including checks with the Central Credit Reference Information System (CCRIS) and various credit report agencies are performed before approval for loans applications are granted."
The association noted that banks adhere to responsible financing practices in providing loans to avoid exposing both the bank and the borrower to increased credit risks.
"Our member banks also view fraud very seriously and if falsifications are detected, banks would take immediate steps to address the issue and reject the application."
ABM advised members of the public to practise prudent spending within their means to avoid being caught in a financial quandary.
"This also applies to having careful planning with regards to using facilities such as debit cards and other payment cards.
"A debit card is a payment card where the transaction amount is deducted immediately from your savings and/or current account, upon authorisation. ATM cards in Malaysia also function as debit cards and allow cardholders to make purchases at point of sale terminals. Debit cards are a convenient alternative to carrying cash."
"If there are insufficient funds in the card holder's bank account to meet the payment, the payment transaction would be declined. In addition, debit cardholders have the option to set their preferred limits for transactions at point of sale terminals and for ATM withdrawals."
ABM added that its member banks remain committed to adhering to the guidelines of responsible financing and are continuously supportive in providing access to financing to eligible applicants.