Credit Bureau: Malaysians good pay­mas­ters

The Sun (Malaysia) - - SUNBIZ - BY LEE WENG KHUEN

PETALING JAYA: Over 95% of Malaysians pay their loans on time amid high house­hold debts that have raised con­cerns, ac­cord­ing to Credit Bureau Malaysia (CBM).

Data shows that from the one mil­lion sam­ples taken from the Credit Cen­tral Ref­er­ence In­for­ma­tion Sys­tem (CCRIS), close to 30% have the high­est grade of “AA”, said CBM CEO KC Wong.

“In fact, more than 97% of the scores gen­er­ated are of good credit stand­ing,” he told re­porters at a me­dia work­shop on credit pos­i­tive here yes­ter­day.

Wong was re­luc­tant to say that the results show un­due con­cern on the fi­nan­cial sys­tem, but stressed that the de­fault rate is only 2% to 3%.

He said CBM is tar­get­ing to in­cor­po­rate data from PBM, which will have the cur­rent mar­ket prices of prop­er­ties in port­fo­lio, to pro­vide a more thor­ough re­view of credit pro­files.

CBM, a unit of Credit Guar­an­tee Corp (CGC), has ac­cess to CCRIS, the Com­pa­nies Com­mis­sion of Malaysia (SSM) and soon PBM. Each in­di­vid­ual will have their own credit scor­ing, called MySCoRE, which is de­rived from the avail­able data.

There are 10 credit grades for the credit scor­ing from AA to JJ with a max­i­mum score of 900. Each cat­e­gory sug­gests dif­fer­ent range of the prob­a­bil­ity of de­fault. Gen­er­ally it is eas­ier for those who score EE and above to get fi­nanc­ing from the banks.

The credit scor­ing is mainly premised on the re­pay­ment record, loan-to-salary ra­tio and credit card us­age.

Wong said the public are ad­vised to pay their loans on time as one will be con­sid­ered a bad pay­mas­ter if there are more than three late pay­ments.

He high­lighted that the sce­nario will be­come worse if one does not re­spond to any le­gal doc­u­ments and makes him­self/her­self “un­con­tactable”.

For credit cards, it is ad­vised that the con­sump­tion amount not ex­ceed 30% of the to­tal credit limit.

As those who have taken PTPTN loans are now in­cluded in the CCRIS data­base, Wong said the PTPTN pay­ment can­not be ig­nored and bor­row­ers must stay “con­tactable”.

“The rem­edy is sim­ple, we just need you to go to the PTPTN of­fice, ei­ther pay the ar­rears or work out the re­pay­ment sched­ule,” he said.

By high­light­ing good credit con­duct and en­abling swift ef­fi­cient processing by fi­nan­cial in­sti­tu­tions CBM can help con­sumers have wider choices and at more com­pet­i­tive rates.

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