15th March 2022 - 2 min read
The Ministry of Finance (MOF) has reiterated that it is currently working with Bank Negara Malaysia (BNM) and the Securities Commission Malaysia (SC) to formulate a legal framework that will regulate all consumer credit activities by this year. Set to be implemented with the enactment of the Consumer Credit Act (CCA), it will also provide regulations for updated payment methods such as buy-now-pay-later (BNPL) schemes.
According to Deputy Finance Minister II, Yamani Hafez Musa, the three entities are already engaging and spearheading collaborations with relevant agencies to work on the framework.
“With the CCA, all credit and BNPL providers will be subject to relevant regulations that also encompass risk control and consumer protection, as well as the appropriate shariah compliance rules in performing BNPL activities,” Yamani Hafez said.
The deputy minister further clarified that BNPL activities are currently not regulated by any agencies; as such, all consumers who tap into these payment schemes must take special care to protect their own interests. They are advised to study the BNPL terms and conditions, and ensure that instalment payments are made in full and on time. The public must also monitor their BNPL commitments so that they do not exceed their financial capabilities.
Finally, Yamani Hafez noted that the government foresees more of such innovations to crop up in line with the digital acceleration that is taking place, and intends to ensure that these are well-regulated too.
The CCA was originally conceived as one of the strategic outcomes under BNM’s Business Plan 2018-2020, but it was eventually postponed to be included under Budget 2021. Subsequently, BNM said that it is looking to pass the CCA in 2022, and called for support from relevant authorities.
(Source: The Edge Markets)
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