Kuala lumpur: The Ministry of Housing and Local Government (KPKT) has urged the public, particularly those facing financial difficulties, not to fall prey to illegal money-lending schemes. Minister Nga Kor Ming instead advised the public to obtain loans only through licensed moneylenders registered under the Moneylenders Act 1951 (Act 400).

According to BERNAMA News Agency, the annual interest rate under the Act must not exceed 18 per cent for unsecured loans and 12 per cent for secured loans. ‘Moneylenders are not allowed to impose total interest charges that exceed the principal amount,’ Nga Kor Ming said in a statement today. The statement was issued following a fire involving three terrace houses in Taman Tasek Gelugor Utama, which is believed to be linked to the activities of illegal moneylenders.

Nga stated that Section 29(B) of Act 400 prohibits licensed moneylenders or their representatives from visiting borrowers’ homes or workplaces to collect repayments or to intimidate them. ‘In the event of a violation of this provision, the public is urged to immediately lodge a report with KPKT or the police so that appropriate action can be taken against those involved,’ he added.

The public is advised to verify the status of moneylenders via the i-Kredikom application or by contacting KPKT to ensure they are licensed and registered. The ministry views illegal moneylending activities by Ah Long or loan sharks seriously, as they target low-income and desperate groups, affecting people’s safety and well-being.

Nga highlighted that Ah Long or illegal moneylenders often exploit individuals in financial distress by trapping them in a cycle of debt through high-interest rates, harassment, and violence. He also urged the police to take firm and comprehensive action to eradicate the activity from its roots.