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Bounced cheques: Banks now empowered to act
Published on: Friday, February 17, 2017

Kota Kinabalu: A Bank Negara Malaysia (BNM) official said it is no longer overseeing the cheque payment delinquent system controlling bounced cheques, as currently the respective commercial banks are empowered to take action on their own discretion in blacklisting offenders which will be recorded in their credit worthiness data.

The details of BNM's assistance and application forms are also available from www.smeinfo.com.my.

Challenges faced by SME include unavailability of collateral and track record, high cost of financing, stringent terms and conditions, according to Credit Guarantee Corporation (CGC), an agency of BNM.

He told a seminar for some 100 SME members of the Malaysia China Chamber of Commerce (MCCC) that CGC's role is to assist SMEs in securing financing from financial institutions without collaterals and offers schemes like BIZSME for working capital only to all viable businesses.

In his address, MCCC first vice president N. K. Foo thanked the central bank for holding the seminar and the speakers – Bank Negara's Syarulazmi on 'Bank Negara Assistance for SMEs', Hasnita Binti Mahayudin from RHB Group on 'Renminbi Cross Border Trade Settlement', and Mohd Roslezam bin Akop of Credit Guarantee Corporation on "CGC Assistance for SMEs" on behalf of his President Datuk Frankie Liew.

A participant complained that while policies and schemes look good and helpful on paper, the application for and the implementation approval to obtain the facility required are altogether a different ball game being played out by the commercial banks concerned and the offering agencies qualifying the applicants.

BNM replied that it could not comment cases in general and that it depends on the qualifying criteria of the applicant.

A customer complained that CGC is discriminating oil and gas or timber industry like a "sunset industry" due to economic downturn coming up with terms like moneylender although a CGC speaker mentioned that CGC is not an 'Ah Long' or loan shark.

CGC asked such businesses to clarify with its local branch office for solutions peculiar to local Sabah scenario, not known in Kuala Lumpur where NPLs from the sector could be high.

An automotive businessman complained as to why the industry was classified as "high risk" as that compounded loan applications for the last 10 years. BNM official urged complainants to consult other banks as business is very competitive depending on their risk appetite.

RHB Vice President for corporate sales in group transaction banking, Hasnita binti Mahayudin revealed that businesses dealing with China using the RHB Renminbi settlement for trade facility enjoy savings in banking charges and forex in relation to the USD, and the same can be used for trade with the Philippines, Thailand and Europe as well.

"RHB Bank is now offering trade settlement services in Remminbi in line with the Government of China's programme for cross-border trade transactions.

"Malaysia companies can have another option to settle trade transactions with counterparts in China besides other currencies such as US dollar," Hasnita said.

She said by eliminating the forex concern of the exports in China, Malaysian importers may save the currency fluctuation premium in the RMB quotation of up to 5 to 7 per cent.

Hasnita said transaction volume in the bank's Renminbi facility has reached 300 million per annum.

BNM Regional Office Head Zambre based here encourages SMEs to liaison with his office and officers including its economist as the central bank is keen to know the actual situation on the ground when businesses voice their woes and concerns to them in feedback. - David Thien

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