Household debts up average 16%
12/04/2007 The Star By Jack Wong
KUCHING: Household debts in the country grew an average 15.9% in the past
six years, with outstanding (household) loans at RM394.8bil as at end-2006.
About 50% of the debts, which accounted for 72.3% of the gross domestic
product (GDP), were mortgages while a further 24% were hire-purchase
financing, said Bank Negara Credit Counselling and Debt Management Agency
chairman Datuk L. Meyyappan.
“Outstanding balances of credit cards have been posting double-digit growth
over the years. However, the rising credit-card balances has not posed much
concern over financial stability,” he said when launching the agency's
Sarawak branch office yesterday.
Meyyappan said credit-card debts made up only 3.3% of the banking sector
loans and 5% of household debts.
Datuk L. Meyyappan: The rising credit card balances has not posed much
concern over financial stability
Last year, he said, credit cards in circulation increased by 12.8% to 8.8
million while the number of transactions and payments made using credit
cards rose by 15.5% to RM47.5bil.
“While the value of purchases and payments has been rising in recent years,
60% of these transactions are being consistently paid in full by the
cardholders over the past three years.
“This is a clear indication that a substantial proportion of the holders
used credit cards to facilitate payments rather than as a source for
credit,” Meyyappan said.
He said that outstanding balances of credit cards had been on a rising trend
and jumped to RM19.8bil at end-2006. This showed an annual growth of 19%.
Meyyappan said defaults for credit cards remained low at 3.7% of the
outstanding balances. |