THE world is still reeling from the impact of the Covid-19 pandemic, with no end in sight. Malaysia is however in the recovery phase, and if the phase is properly and firmly handled, it may see us exit the crisis in a few months, albeit in a new normal mode.
The economic measures taken by the government are proactive and laudable, though not benefiting some of the sectors that are the most affected, like the B40.
Subsidies, cash payouts, loan moratoriums offer some significant relief, and the continual reduction of the overnight policy rate is helping households and businesses service their debts.
However, as more reduction of the interest rates are anticipated in view of the stuttering economy, there is one niche segment of the population that is particularly vulnerable, that is the older segment of the B40 rakyat, who are not pensioners, not civil servants, and who only depend on the interest from their retirement nest eggs to survive.
Proposing to reduce the interest rate to 1.5% or less to help others will just strangle these segments, already painted into a corner, and forced to use up what little savings they have, to remain independent in such dire times.
The government should implement a scheme to help these folks who have to depend on themselves to eke out a living, unlike pensioners who even get an automatic 2% top-up of their lifetime incomes annually.
The scheme I envisage should mandate banks to pay to each fixed deposit depositor in their banks over 60 years old interest of 2.5% per annum, up to deposits of 300,000 accumulated or in a single amount. The difference of 2.5% and the prevailing Bank Negara rate will be subsidised and reimbursed by the government to the banks, through the operations of the scheme.
In this way, those without a voice, and without recourse to alternative sources of income to sustain themselves will receive a little financial help and a moral boost in these trying times.
Tam Yeng Siang