Friday, December 30, 2011

More Than 235,000 Individuals Declared Bankrupt

Ouch! Really?

Yes. The number of bankrupt individuals in Malaysia is almost a quarter of a million. 235,908 individuals to be exact, according to the Department of Insolvency.

Is this figure alarming? According to the Director-General of Insolvency Department, it is, and it should be to us, too.

The department statistics show that there are 41 individuals declared bankrupt every day! At this rate, by the end of this year there would be more than 238,000 bankrupts and if there's no immediate bold action this could well reach half a million by 2020 when we anticipate the country to have attained developed nation status.


Bankrupt2011
Daily Express, Malaysia.

      "A bankrupt is someone who has officially declared that he cannot pay what he owes. In Malaysia, the minimum amount of outstanding debt amount to initiate bankruptcy is RM30,000. Malaysia’s bankruptcy law is based on English law and comes under the Bankruptcy Act 1967." - malaysia.gov.my


The main causes for declaring the 235,908 individuals bankrupt are:
1. Hire purchase, 26%
2. Personal loan, 21%
3. Housing loan, 14%
4. Others - business loan, corporate guarantee,
- wondering where the C.Card defaulters came under.

Between 2005 and October 2011, about 14,000 cases were discharged of bankruptcy, meaning for each discharged case there are 6 others being declared bankrupt, (Ratio 1:6.4). This is not good at all from social point of view, more so with our aspiration to progress and to prosper at higher pace towards 2020.

The government is reviewing the Malaysian Bankruptcy Act 1967 to assist those who were declared bankrupt to continue with life without the debt burden. But if people don't take bankruptcy seriously and think that they can get away from debtors and start fresh with their lives by filing for bankruptcy, think again. If being bankrupt makes life no better than before, don't opt for it.

Think about the THREE main causes for bankruptcy and borrow only what you can afford. Live within your/our means.

Talking about living within your means, how about making one a resolution for the new year? Could be a good idea.

Reference: Malaysia Department of Insolvency

6 comments:

KY Chua said...

"wondering where the C.Card defaulters came under."

I think they reclassified and include them within the 4 factors. :)

My new year resolution, one of them, eat less, buy less. God for pocket and tummy. :D Have a nice day/ ;)

thomas said...

Wow!The situation look bad as it is almost 1% of the population.

HoneyBUZZin said...

Not surprise at all. Nothing is cheap nowadays. I used to buy things whichever and whenever I want but now no more. I even strike off my credit card.
I pay cash now, most importantly, I'm debt free.
Teda duit...diam-diam only. Haha..

tehr said...

aku kesian pada yang jadi penjamin tu
tak pasal2 diisytihar muflis

de engineur said...

There should be a law to protect the guarantors such that financial institutions don't come chasing after them (at pleasure) on the first instance the borrowers default on repayment.

Meitzeu said...

Community sickness. sigh...

mt
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