Companies Require More Flexible Repayment Options

With the COVID-19 pandemic unabated and companies still suffering to get back on their feet after numerous lockdowns, banks should offer more flexible repayment options to companies.

Speaking to Business Today, Senior fellow at the Malaysian Institute of Economic Research, Dr Shankaran Nambiar says it would be helpful if companies could be given more favourable rates of payment or a longer time period to settle without the burden of additional interest payments.

“Banks, after all, are doing well, so there is no threat to the banking system.”

He says this was necessary since many companies might go under once the moratorium period comes up and others might be struggling to come back on their feet.

On the other hand, there is a related problem that may surface after the moratorium period is over with non-performing loans or NPLs.

For that matter, he suggests that the cutoff level for bankruptcy be raised.

“A related problem is the possibility of rising NPLs. The cutoff level for bankruptcy has to be raised. 

“Otherwise more individuals will be declared bankrupt and that will make things more difficult for entrepreneurs.  

“The efforts of genuine businessmen who failed solely because of the lockdowns will be penalised because of the difficult environment and not for any fault of theirs.”

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