Latest news with #ConsumerCreditAct
The Sun
3 days ago
- Business
- The Sun
Consumer Credit Act will foster trust, transparency and more responsible credit usage: Atome
KUALA LUMPUR: The incoming Consumer Credit Act will foster trust, transparency and more responsible credit usage, said Atome Malaysia's head of BNPL (buy now, pay later), Danny Lim. The legislation will also help enhance confidence in BNPL services and the industry, he added. 'In terms of what we focus on, in the short term, we want to make sure that we are supporting the regulators as they finalise the Bill. That's our commitment, working with the regulators, seeking their advice, and also doing what's required,' he told SunBiz. Lim said Atome fully supports the introduction of the Act as many still don't have access to bank credit. There are still underserved segments without access to regulated financial services, and we're bridging that gap by supporting their short-term financing needs.' Lim stressed that Atome aims to improve financial literacy and ensure users understand how to use BNPL as a budgeting tool and not for overspending. He pointed to a survey by the Consumer Credit Oversight Board, which found that 73% of BNPL users earn less than RM5,000 per month and of which 69% say that this is their only source of financing as they don't have access to or are not served by any bank. However, Lim acknowledged that public perception of BNPL is negative, largely due to regulatory gaps and lack of awareness. 'And, of this, I think it's important to ensure that we give public confidence, so these regulators' view coming up to us is a good positive move, so that users are more confident in using this. That's how we see it.' Atome compliance lead Inderjit Singh said its internal frameworks are modelled on regulatory standards from other countries where BNPL is already supervised, such as Singapore and the Philippines. 'We've got no regulation here (Malaysia) now. Internally, whatever we develop, our risk management frameworks, our business strategies, compliance framework, is based on what we've done in other markets.' Inderjit said when Malaysia's Consumer Credit Act comes into force, only minor adjustments will be needed. 'We already have something in place that should be sufficient from a regulatory perspective. Operationally, regulation won't impact us too much.' According to news reports, Deputy Finance Minister Lim Hui Ying said BNPL transaction volumes rose from RM83.8 million in the second half of 2024 to RM102.6 million in the first half of this year. During the second reading of the Consumer Credit Bill 2025 in the Dewan Rakyat on July 21, Hui Ying said the surge in BNPL activity poses risks to consumers, especially low-income groups and those with poor financial literacy, who are vulnerable to unmanageable debt. The total value of BNPL transactions increased 31%, from RM7.1 billion in second-half 2024 (H2'24) to RM9.3 billion in H1'25. The number of active BNPL accounts rose from 5.1 million at the end of last year to 6.5 million as of end-June. To address this and protect the interests of credit consumers, the government will establish a statutory body known as the Consumer Credit Commission (CCC) under the Consumer Credit Act. The commission, under the Ministry of Finance, will regulate currently unregulated sectors through a licensing and registration framework. Hui Ying said the Bill is part of the government's broader effort to introduce comprehensive consumer credit legislation and restructure Malaysia's credit landscape. It is designed to address two major challenges – the presence of unregulated industry players and the fragmented oversight of the credit sector by multiple authorities. 'The Bill's core aim is to protect consumer interests by ensuring proper conduct and responsible lending by all credit-related businesses, while promoting a fair, efficient, and transparent credit ecosystem,' she said. The Bill outlines the CCC's responsibilities, including advising the government on national consumer credit policy, promoting fair and responsible market practices and granting licences based on a 'fit and proper' evaluation. 'With this Bill, the government affirms its commitment to creating a safer credit ecosystem for the rakyat,' said Hui Ying. The deputy finance minister tabled the Bill for its first reading in the Dewan Rakyat on March 4. It was passed during the second reading through a majority voice vote on July 21. The Consumer Credit Bill 2025 paves the way for regulating non-bank credit and credit service providers amid rising concerns over BNPL scheme proliferation. Under the Bill, six types of businesses will come under the commission's oversight. Three will require licences from the CCC to operate – BNPL providers, leasing companies and factoring services providers (including syariah-compliant offerings). In financial terms, factoring involves a business selling its unpaid invoices to a third party, or 'factor', at a discount to raise working capital. The other three – debt collection, acquisition of non-performing loans or financing, and debt counselling or management services – must register with the CCC. In total, 253 businesses across these six categories will be regulated. Additionally, under the new law, the Ministry of Housing and Local Government will be responsible for licensing syariah-compliant pawnbroking (Ar-Rahnu) and syariah-compliant credit facilities.
The Sun
5 days ago
- Business
- The Sun
The FIVE reasons why I never use my debit card – I think they're pointless, you should ditch them too
OUR wallets are crammed with plastic - but there's one card I never use and is completely pointless. For many, a debit card is a go-to for everyday shopping. 1 But I think everyone should ditch it - and there's a much better option that will MAKE you money and offer more protection on your purchases. When it comes to being a savvy spender, debit cards are rubbish. Instead, I use a credit card and here I explain the five reasons why I think everyone else should make a switch too. Make use of a secret weapon in your wallet If you've ever bought a big-ticket item – perhaps a new sofa, a swanky TV, or even booked a holiday – and then had it go wrong? It's a nightmare scenario we all dread. And if you paid with your debit card, you might be in for a nasty surprise. While debit cards offer " chargeback", where your bank tries to recover your money from the retailer, it's not guaranteed. It's a voluntary agreement, not a legal right, so your bank can try - but there's no promise you'll get your money back. Now compare that to credit cards. If you spend over £100 and under £30,000, you're automatically covered by Section 75 of the Consumer Credit Act. Four methods you can use to clear debt This is consumer protection gold. It means your credit card company is equally liable with the retailer if something goes wrong. So, if your new sofa doesn't arrive, is faulty, or your holiday company goes bust, paying with a credit card gives you far better protection. You're missing out on loyalty points This one really grinds my gears. In a world where every click and every purchase is tracked, why aren't you getting something back for your loyalty? Every time you tap your debit card, you're throwing away free money - or in my case, free holidays. Every time I spend a quid on my British Airways Premium Plus American Express credit card, I'm racking up 1.5 Avios airmiles. If I'm booking a flight on that jumps to a whopping three Avios per £1 spent. Those points can go towards free flights, holiday bookings, cabin upgrades, and more – just for spending money I was going to spend anyway. American Express has credit cards for Nectar members too, giving shoppers two points for every £1 spent. If you want flexibility with how you use your points, American Express Reward, Gold, and Platinum cards let you earn one "membership" point for every £1 spent. This means you could exchange some of these points for airmiles with airlines like British Airways, Iberia, Qatar, Emirates, and Virgin Atlantic. Then redeem more for discounts on hotel bookings with Hilton, Marriott, and Radisson. Plus, Amex allows you to convert points to help lower your credit card bill, with 1,000 points worth £4.50. My debit card gives me nothing - no perks, no points, no rewards so why spend money without getting something back? Free cash when you spend Most high street banks and their debit cards are notoriously tight-fisted when it comes to cashback. Some bank accounts with monthly fees or challenger banks like Chase do offer up to 1% cashback, but if you're like the majority and have a standard fee-free high street current account, your debit card won't give you any instant savings. But with my credit card, it's a completely different story. My American Express app is packed with offers. I just tap to add them to my card, and I get instant savings on things like my weekly shop or streaming services. Right now, I'm getting 15% back on my Disney+ subscription every month – free money for something I'd be paying for anyway, automatically applied. Plus, if you're an Amazon Prime fan like me, my fee-free Amazon Barclaycard gives me 1% cashback on all my online orders. The best part? Cashback doubles during events like Prime Day, letting me earn even more while I shop. If cashback is your only concern, the American Express Cashback Everyday Credit Card is a great option for those expecting a high-spend period. It offers an impressive 5% cashback on purchases for the first five months (up to £125). After this introductory period, you can earn up to 1% cashback, but you'll need to spend over £10,000 annually to qualify for ongoing rewards. For those who might not meet the £10,000 annual spending threshold, the American Express Cashback Credit Card is another strong choice. It also offers 5% cashback for the first three months (up to £125), followed by 0.75% cashback on spending up to £10,000 per year and 1.25% above that. What is cashback? CASHBACK is a type of reward offered by banks, credit card providers, and retailers where customers receive a percentage of their spending back as cash. Essentially, it's a way to earn money while making purchases. For example, if your card offers 1% cashback and you spend £100, you'll earn £1 back. Cashback can be credited to your account, deducted from your balance, or saved up for future use, depending on the provider's terms. It's often offered on everyday purchases, such as groceries, fuel, or online shopping, and may be part of a promotional deal or an ongoing benefit of your account. However, remember to check the terms and conditions, as some transactions may not qualify for cashback rewards. By using cashback offers wisely, you can usually make your money go further on purchases you'd already be making. It does nothing for your credit score Building a good credit score is crucial. It's not just for big loans like mortgages - it affects everything from mobile phone contracts to car finance. Using a debit card without an overdraft doesn't help your credit score because you're just spending your own money. But, using a credit card responsibly – that is, making sure you pay it off in full and on time every single month – is a fantastic way to prove you're a trustworthy borrower. It demonstrates financial discipline and builds a positive credit history. However, I must give you a big fat warning here... If you're not disciplined with money, credit cards can wreak havoc on your score and future borrowing capabilities. Miss payments, and you'll trash your ability to get a loan or mortgage for years. So, only use them if you can be trusted to clear your balance. How can I boost my credit score? A ROBUST credit score is a golden ticket to better deals. Andrew Hagger, founder of Moneycomms, said the most important move is to register to vote. This is because lenders need to check your identity and address to confirm you're not a fraudster. For Experian, being on the electoral register can yield you 50 points. Also, don't make too many credit applications as this can be a sign of financial distress. And if you already have a credit card or loan, never miss a payment. Kara Gammell, financial expert at MoneySupermarket, said: "A missed payment can negatively affect your rating." Renters who want to boost their credit score can also report their rent payments to three of the major credit reference agencies to prove they can pay their bills on time. CreditLadder introduced rent reporting to the UK for all tenants in 2017. Two out of five households rent, and CreditLadder can report those rent payments to all the main credit reference agencies, which can help you improve your credit history and score. They come with expensive borrowing costs An overdraft lets you spend or withdraw money with your debit card even if your balance is below £0. But overdrafts are one of the most expensive ways to borrow, with most banks charging a steep 39.9% APR. TotallyMoney found that one in five people go overdrawn by an average of £697 a day, quickly racking up interest. Credit cards, however, usually have much lower rates - between 18% and 24.9% APR, according to MoneySuperMarket. If you were to borrow £1,000 for a year on a credit card at 18% APR it would cost you around £180 in interest. Whereas, on a 39.9% APR overdraft, the same £1,000 would cost nearly £400. When it comes to borrowing small amounts, credit cards are the clear winner. Plus, you can even snag introductory 0% credit card deals, giving you a period to borrow completely interest-free. Just remember that these offers are usually tailored for managing existing debt or making planned, affordable purchases. They are not for spontaneous spending sprees unless you're completely debt-free otherwise and can pay it back within the interest-free period.
The Star
21-07-2025
- Business
- The Star
'Buy now, pay later' transactions hit 102.6 million in 1H25
KUALA LUMPUR: The volume of "buy now, pay later' (BNPL) transactions has increased from 83.8 million in the second half (2H) of 2024 to 102.6 million in the first half (1H) of this year. Deputy Finance Minister Lim Hui Ying said the surge in BNPL transactions exposes consumers to risks, especially those in the low-income group and with poor financial literacy to the risk of unmanageable debts. The total value of BNPL transactions rose 31 per cent from RM7.1 billion in 2H 2024 to RM9.3 billion in 1H 2025. Meanwhile, the number of active BNPL accounts also increased from 5.1 million at the end of last year to 6.5 million as of end-June this year. "To address this issue in protecting the interests of credit consumers, a statutory body known as the Consumer Credit Commission (SKP) will be established under the Consumer Credit Act,' Lim said when tabling the Consumer Credit Bill 2025 for the second reading in the Dewan Rakyat today. She said the commission, which will come under the Ministry of Finance, will regulate business sectors that are currently not regulated by any party via a licensing and registration framework. Lim said the Consumer Credit Bill is tabled as part of the government's effort to establish comprehensive legislation to protect credit consumers and restructure the nation's credit industry landscape. The bill was drafted to tackle two main issues: the presence of unregulated industry players and inconsistencies in credit sector oversight by various authorities. "The bill's main objective is to protect the interests of credit consumers in the country by regulating all credit businesses and credit service businesses, ensuring proper conduct and responsible lending practices by industry participants as well as promoting a fair, efficient, and transparent credit industry,' she said. According to Lim, the bill outlines the responsibilities of the SKP, including advising the government on national consumer credit policy; promoting fair, professional, and responsible practices; and licensing based on the "fit and proper' principle. "Through the implementation of the bill, the government demonstrates a strong commitment to creating a safer credit ecosystem for the people's well-being,' said Lim. Lim tabled the bill for its first reading in the Dewan Rakyat on March 4. - Bernama
Sinar Daily
21-07-2025
- Business
- Sinar Daily
BNPL transactions hit 102.6 million in 1H 2025
The surge in BNPL transactions exposes consumers to risks, especially those in the low-income group and with poor financial literacy to the risk of unmanageable debts. 21 Jul 2025 03:12pm The volume of "buy now, pay later' (BNPL) transactions has increased from 83.8 million in the second half (2H) of 2024 to 102.6 million in the first half (1H) of this year. - Photo illustrated by Sinar Daily KUALA LUMPUR - The volume of "buy now, pay later' (BNPL) transactions has increased from 83.8 million in the second half (2H) of 2024 to 102.6 million in the first half (1H) of this year. Deputy Finance Minister Lim Hui Ying said the surge in BNPL transactions exposes consumers to risks, especially those in the low-income group and with poor financial literacy to the risk of unmanageable debts. The total value of BNPL transactions rose 31 per cent from RM7.1 billion in 2H 2024 to RM9.3 billion in 1H 2025. Meanwhile, the number of active BNPL accounts also increased from 5.1 million at the end of last year to 6.5 million as of end-June this year. "To address this issue in protecting the interests of credit consumers, a statutory body known as the Consumer Credit Commission (SKP) will be established under the Consumer Credit Act,' Lim said when tabling the Consumer Credit Bill 2025 for the second reading in the Dewan Rakyat today. She said the commission, which will come under the Ministry of Finance, will regulate business sectors that are currently not regulated by any party via a licensing and registration framework. Lim said the Consumer Credit Bill is tabled as part of the government's effort to establish comprehensive legislation to protect credit consumers and restructure the nation's credit industry landscape. The bill was drafted to tackle two main issues: the presence of unregulated industry players and inconsistencies in credit sector oversight by various authorities. "The bill's main objective is to protect the interests of credit consumers in the country by regulating all credit businesses and credit service businesses, ensuring proper conduct and responsible lending practices by industry participants as well as promoting a fair, efficient, and transparent credit industry,' she said. According to Lim, the bill outlines the responsibilities of the SKP, including advising the government on national consumer credit policy; promoting fair, professional, and responsible practices; and licensing based on the "fit and proper' principle. "Through the implementation of the bill, the government demonstrates a strong commitment to creating a safer credit ecosystem for the people's well-being,' said Lim. Lim tabled the bill for its first reading in the Dewan Rakyat on March 4. - BERNAMA More Like This
The Sun
21-07-2025
- Business
- The Sun
BNPL transactions surge to 102.6 million in 1H 2025
KUALA LUMPUR: The volume of 'buy now, pay later' (BNPL) transactions in Malaysia surged to 102.6 million in the first half of 2025, up from 83.8 million in the second half of 2024. Deputy Finance Minister Lim Hui Ying highlighted concerns over rising consumer risks, particularly among low-income groups with limited financial literacy. The total value of BNPL transactions increased by 31 per cent, reaching RM9.3 billion in 1H 2025 compared to RM7.1 billion in 2H 2024. Active BNPL accounts also rose from 5.1 million at the end of 2024 to 6.5 million by June 2025. To address these risks, the government is establishing the Consumer Credit Commission (SKP) under the Consumer Credit Act. Lim stated, 'The commission will regulate currently unregulated sectors through a licensing and registration framework.' The Consumer Credit Bill 2025 aims to protect consumers by ensuring responsible lending practices and promoting a fair credit industry. Lim added, 'This bill reflects the government's commitment to a safer credit ecosystem.' - Bernama
