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Most govt business loans difficult to secure: PKR
Published on: Friday, November 17, 2017

Labuan: Many business-related loans established by government allocations and promoted by political parties are often under-utilised because these loans are often described as "on soft and easy terms" and in fact "hard and difficult to secure".

PKR chief here Simsudin Sidek said this when commenting on Parti Gerakan's promotion of its Yayasan Penjaja dan Peniaga Kecil 1Malaysia loans here last week.

Some RM30 million is said to have been set aside by the Foundation as soft loans for Chinese hawkers and small traders.

Simsudin said it was certainly thoughtful of Parti Gerakan to offer the loans here "but from the feedback we gather these loans are only soft in terms of low interest rate of four per cent per month while most of its other terms were difficult to comply."

He said the main stumbling block to be successful in applying for loans of between RM30 to RM50 thousand was that the applicant must have a guarantor who could be held responsible incase of default.

"Honestly, who would like to stand in as a guarantor at present difficult times, it is a matter of high unnecessary risk, if the political party is sincere it should itself be able to stand as guarantor."

Simsudin added another set-back was that those above the age of 60 years are not qualified to apply for loan," may we know why? Does it mean that the business ability of those at this age has expired? Survey would show that many such citizens were more reliable and needed loans to expand their business, the condition therefore had little sense as loans are meant to be helpful without age discrimination."

Another provision in the loan application was that the applicant need to enclose Form J from IRB and profit and loss account. This also made little sense since application for BRIM IRB could clear the application without him or her submitting any form to IRB, IRB has the mechanism to check and why burden the loan applicant with this requirement.

He said if the small traders or hawkers were in strong financial position, they would not need to loan.

On a final note, Simsudin also pointed out that earlier this year Deputy Minister in the PM's Department, Datuk Devasamy was here also to promote Tekun Fund and seed funds for entrepreneurs to start-up business but the response was hardly encouraging as there was no record to show how many were successful in their applications. - Sohan Das

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