KPKT Warns Public Against Illegal Moneylenders

PUTRAJAYA, June 28 (Bernama) -- The Ministry of Housing and Local Government (KPKT) has urged the public, particularly those facing financial difficulties, not to fall prey to illegal money-lending schemes.

Minister Nga Kor Ming instead advised the public to obtain loans only through licensed moneylenders registered under the Moneylenders Act 1951 (Act 400).

He said that under the Act, the annual interest rate must not exceed 18 per cent for unsecured loans and 12 per cent for secured loans.

“Moneylenders are not allowed to impose total interest charges that exceed the principal amount,” he said in a statement here today.

The statement was issued following a fire involving three terrace houses in Taman Tasek Gelugor Utama, which is believed to be linked to the activities of illegal moneylenders.

Nga said Section 29(B) of Act 400 prohibits licensed moneylenders or their representatives from going to borrowers’ homes or workplaces to collect repayments or to intimidate them.

“In the event of a violation of this provision, the public is urged to immediately lodge a report with KPKT or the police so that appropriate action can be taken against those involved,” he said.

Nga also advised the public to check the status of moneylenders via the i-Kredikom application or by contacting KPKT to ensure they were licensed and registered.

He said the ministry took a serious view of illegal moneylending activities by Ah Long or loan sharks, which preyed on low-income and desperate groups, affecting the safety and well-being of the people.

“Ah Long or illegal moneylenders often take advantage of individuals who are desperate due to financial hardship by trapping them in a vicious cycle of debt through exorbitant interest rates, harassment and violence,” he said.

Nga also urged the police to take firm and comprehensive action to eradicate the activity from its roots.

--BERNAMA