KUALA LUMPUR: Gerakan Ekonomi Malaysia (GEM) has urged the government to implement an automatic blanket loan moratorium as soon as possible until Covid-19 herd immunity is achieved.
GEM president Armin Baniaz Pahamin said many rakyat and businesses were denied the targeted moratorium implemented currently as they had to go through tedious processes to apply for repayment assistance from banks.
He said this had led them to feel desperate financially, some of which had resorted to suicide.
"We take seriously the statement made by Bumiputera Retailers Organisation president Datuk Ameer Ali Mydin of which he claimed that the majority of Bumiputera retailers are teetering on the brink of collapse after the government implemented the Movement Control Order 3.0.
"We take note of and fully support the request of the 140 non-governmental organisations as well as chambers of commerce for an automatic blanket moratorium," he said in a statement today.
Armin said during the first five months of the year, 53 suicide cases were reported in Penang while the number of suicide cases across Malaysia increased by more than 20 per cent with the main cause being in debt.
"We also received many reports through our field sessions with the rakyat on how difficult it is for entrepreneurs and traders to apply for a moratorium from banks.
"The details, information and documents requested by banks complicate the situation. The applicants are already in severe burden and is pressed again with various requests by banks. Rakyat who are already struggling should no longer be burdened with the processes to apply for a loan moratorium," he added.
He said a blanket moratorium on loans can be offered by financial institutions without incurring any additional budget from the government.
Armin added that banks had recorded profit growth during the pandemic and this proved that financial institution's performance was not affected compared to the situation of most individuals and businesses that were on the verge of bankruptcy.
GEM also called on the government to channel the rent moratorium assistance as approved in the UK until March 2022, as well as provided reduced utility payments and options for the people to withdraw their Employees Provident Fund savings.