BANKS must continue the loan moratorium for at least three more months to help low-wage earners and businesses reeling from the economic slump caused by the Covid-19 pandemic, said the National Union of Bank Employees (NUBE).

The union said that its own members are also facing financial hardship and will suffer with the end of the moratorium last month.

“The government must immediately get banks to expand the blanket moratorium for at least three months for all those in the lower income groups, especially the B40 and M40, as well as businesses reeling from the economic slump.

“Many of our members are also urgently in need of a further respite from loan repayments,” said union secretary-general J. Solomon.

He added that the union members and many others in the low-income group do not qualify for the targeted moratorium adopted by banks.

He said this was because the banks were offering the targeted moratorium based on the misconception that these borrowers had not lost their jobs or suffered pay cuts and, as such, were unaffected by the economic downturn.

Putrajaya implemented the six-month loan moratorium in April to help borrowers tide through the coronavirus pandemic.

Despite calls by many for the moratorium to be extended, the government said borrowers can liaise with their banks for loan adjustments.

“The government and banks must address the plight of families whose livelihoods have been disrupted. 

“The best way to do that is to reinstate the blanket moratorium on housing, vehicle and personal loans for B40 and M40 families by at least three months, and carry out a review on its necessity periodically based on the prevailing economic and employment situation in the country,” said Solomon.

He added that NUBE members, particularly those in the lowest wage cadre, have remained among the most adversely affected among bank workers by the economic downturn in the country, which continues to worsen under the weight of a second Covid-19 wave.

“Most of our members are on the frontlines, and need to take extra precautions, which will incur additional cost to protect themselves and their families from the pandemic and its impact.

“Extra costs for them include purchasing masks for themselves and their family members, sanitisers, quality food and vitamins to boost their immunity and other new norms-related expenses as a result of social distancing,” he said.

He added that it would not cost the banks much as they will recoup the deferred payments eventually.

“But it can be disastrous to the poor.” – October 4, 2020.