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Consumer group blames banks for high credit card debt among youth

Free Malaysia Today logo Free Malaysia Today 6/9/2018 Nurul Azwa Aris
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PETALING JAYA: A consumer group has blamed Bank Negara Malaysia (BNM) for the high credit card debts among the youth, saying the central bank has failed to protect their interests.

Consumers Association of Subang & Shah Alam (Cassa) president George Jacob said the only way to stop the problem of credit card debts was to prohibit banks from simply issuing cards.

“We should be very stringent in issuing credit cards. Nowadays, it is very easy for banks to approve applications for credit cards.

“We should not issue credit cards so easily to anybody unless they are financially eligible. If not, it is a passport to bankruptcy and debts,” he told FMT.

BNM recently said 47% of Malaysian youths have high credit card debts.

BNM assistant governor Nazrul Hisyam Mohd Noh said last year that more than 3,400 people, aged between 20 and 30, had sought counselling and help from the Credit Counselling and Debt Management Agency.

Jacob said banks were “persuading” people to own credit cards, adding that it was like a war between banks on how many cards they could “sell”.

He said this was part of the banks’ marketing strategy but claimed they did not educate their customers on the financial impacts.

“Who do you blame for this? Do we blame the people who use the money they do not have just because they have credit cards?

“Or do we blame the stakeholders who are supposed to be the watchdogs monitoring credit card usage?”

He urged BNM to tighten the rules to make it difficult for youths to possess credit cards, saying they could not always be blamed as they were neither financially prudent nor mature.

“Who gave them access to use money that they don’t have? The banks.”

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