Putrajaya Moots ‘Escape Clause’ For Bankruptcy
Putrajaya is proposing a move to help Malaysians saddled with debt to avoid being declared bankrupt, reports The Star.
Minister in the Prime Minister’s Department Datuk Seri Azalina Othman said such an option would be introduced in the bill to amend the Bankruptcy Act 1967.
“We want to create a special mechanism whereby if you have a lot of debt, you can volunteer yourself for this option to find a settlement using whatever income you have,” said Azalina, who is also the de facto law minister.
Describing it as a realistic approach to dealing with bankruptcy, she said the bill might be tabled during the current Dewan Rakyat meeting and be read a second time during the meeting in March next year.
“The bill will offer an ‘escape clause’ for debtors. We know creditors are upset because they are owed money but let’s be reasonable,” she said.
“If a guy can’t afford to pay up, we should find the best alternative to enable the repayment.”
The proposal comes amid rising household debt with Bank Negara Malaysia revealing that the country’s household debt stood at RM1.03 trillion or 89.1% of the GDP, making it one of the highest in the region.