KUALA LUMPUR: Individuals and micro, small and medium enterprise loan borrowers affected by the COVID-19 pandemic may apply for a six-month moratorium from tomorrow, said Bank Negara Malaysia (BNM).

in a statement today, the central bank said borrowers are assured that opting in for the moratorium, which is in line with the National People's Well-Being and Economic Recovery Package (PEMULIH), or any other repayment packages need not provide supporting documentation as approval will be given automatically.

"In addition to the moratorium, banks will also offer a reduction in instalments and other packages, including to reschedule and restructure financing to suit the specific financial circumstances of borrowers," BNM said.

The central bank also said that borrowers are advised that opting for repayment assistance will increase the overall cost of borrowing, as interest or profit will continue to accrue on deferred payments.

Banks are required to provide borrowers with information on how instalment amounts and the financing tenure will be impacted, it said.

"Where a borrower requests to maintain lower instalments (instead of original instalments) after the moratorium, this would result in the loan tenure being extended for a longer period.

"Banks will not charge interest on interest, or profit on profit (ie compounding interest/profit), or any penalty interest/profit during the period of assistance," added BNM.

According to the statement, borrowers' Central Credit Reference Information System (CCRIS) records will not be affected by any form of repayment assistance received in 2021.

Borrowers can opt-in online through a web form or an auto-generated email that will be available on banks' websites to provide their personal and financing details, said BNM.

The central bank also urged loan borrowers to contact their respective banks and guidance will be provided by the customer service officer.

"If borrowers are unable to use these digital channels, they may also visit their bank branches to submit their request for the moratorium.

"The banking industry has provided its commitment and assurance to assist borrowers facing financial difficulties due to the lockdown," it said.

In this regard, BNM said it will closely monitor the implementation of the repayment assistance programme by the banking industry.

"If borrowers face any difficulties with their banks, or if instalments increase unreasonably, they may contact BNMTELELINK at bnm.my/RAsurvey to put in their complaints," it said.

-- BERNAMA