UPDATE: No interest, additional charges for car loans – pay the same instalments after 6-month moratorium!

Breaking news! The finance ministry has just issued a release which says that no additional charges will be applied to deferred instalment payments during the entire six-month moratorium period. In short, those with hire purchase loans and fixed-rate Islamic financing will not see any changes to their instalment payments should they take up the moratorium offered by banks.

This is a reversal of an earlier announcement made by Bank Negara Malaysia (BNM) on April 30, whereby those who opt for the moratorium would be charged additional interest after the six-month deferment period.

Prior to this, finance minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz urged the banks to consider abolishing the accrued interest/profit for hire purchase loans and fixed-rate Islamic financing for the six months. At the time, he said that his ministry was taking proactive steps to find a solution for the issue via discussions with BNM and the banks, to find the best solution for the people.

With this announcement, borrowers/customers will need to resume paying their instalments after the moratorium period (April 1 to September 30) based on the terms stated in their financing plans, which will now include a six-month extension to the payment schedule to make up for the six missed payments.

The decision was made after the ministry reached an agreement with the banking industry on the matter. The government says it hopes the decision will help alleviate the burdens of the rakyat during these trying times.

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