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Bank Negara will not review decision on 10-yr limit for loan repayment, says Zeti
by Cals Thu 12 Sep 2013, 22:37
Bank Negara will not review decision on 10-yr limit for loan repayment, says Zeti
Business & Markets 2013
Written by Bernama
Thursday, 12 September 2013 19:20
KUALA LUMPUR (Sept 12): Bank Negara will not review its decision on the 10-year limit repayment period, says Governor Tan Sri Dr Zeti Akhtar Aziz.
Responding to Cuepacs' appeal to review the personal loan repayment limit, Zeti said: "In the world, 10 years for personal loan repayment is the highest, and usually it is about six years in other countries.
"This is because when a person borrows, either to pay for a television set or to pay for a wedding, the money is squandered within a few days."
Zeti said the central bank was avoiding a scenario where a borrower was burdened with a loan for 25 years, which he or she has spent in a few days.
"Personal loans are different from housing loans because when a borrower purchases a house, they will own an asset once they have settled the loan.
"In personal loans, they finish spending the money within a few days, and then they have to undergo the misery of having to pay the debt for the next 10, 15, or 20 years. No, no revision," she stressed.
Zeti was speaking to reporters on the sidelines of the closing ceremony of the 2013 Alliance for Financial Inclusion (AFI) Global Policy Forum today.
The three-day forum, jointly hosted by the AFI and the central bank, concluded today with the AFI Network's commitment to the Sasana Accord.
Through the accord, financial inclusion policy making and strategies would see evidence and data based results that could contribute to accelerate the progress, and the measurement of the impact.
Business & Markets 2013
Written by Bernama
Thursday, 12 September 2013 19:20
KUALA LUMPUR (Sept 12): Bank Negara will not review its decision on the 10-year limit repayment period, says Governor Tan Sri Dr Zeti Akhtar Aziz.
Responding to Cuepacs' appeal to review the personal loan repayment limit, Zeti said: "In the world, 10 years for personal loan repayment is the highest, and usually it is about six years in other countries.
"This is because when a person borrows, either to pay for a television set or to pay for a wedding, the money is squandered within a few days."
Zeti said the central bank was avoiding a scenario where a borrower was burdened with a loan for 25 years, which he or she has spent in a few days.
"Personal loans are different from housing loans because when a borrower purchases a house, they will own an asset once they have settled the loan.
"In personal loans, they finish spending the money within a few days, and then they have to undergo the misery of having to pay the debt for the next 10, 15, or 20 years. No, no revision," she stressed.
Zeti was speaking to reporters on the sidelines of the closing ceremony of the 2013 Alliance for Financial Inclusion (AFI) Global Policy Forum today.
The three-day forum, jointly hosted by the AFI and the central bank, concluded today with the AFI Network's commitment to the Sasana Accord.
Through the accord, financial inclusion policy making and strategies would see evidence and data based results that could contribute to accelerate the progress, and the measurement of the impact.
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