THE number of participants enrolling in the DMP (Debt Management Programme) shot up by a staggering 1,819% to 156,892 as at end-July 2016 from 2007 with poor financial planning being one of the main reasons for the failure to repay debts.

In 2007, the number of enrolment in the programme stood at 8,172.

As at end-July, 460,031 individuals attended the Credit Counselling and Debt Management Agency’s (AKPK) counselling services compared with 32,157 in 2007. The number of participants in the DMP as a share of total counselling cases rose by 34.1% from 25.4% in 2007.

With the tough and challenging economic environment, analysts and industry observers concurred that this figure could rise due to the high household debt level.

The country’s household debt-to-gross domestic product (GDP) ratio rose to 89.1% last year from 87.4% in 2014 and remains significantly higher than that of Indonesia at 17% and Singapore at around 60%

DMP assists borrowers to restructure their financial liabilities to help them meet their loan obligations and living expenses, thereby minimising non-performing loans and foreclosure of houses.

In most cases, the factors contributing to their inability to repay their debts, include poor financial planning, ignorance and lack of financial discipline. Financial difficulties could also be triggered by unanticipated or change in circumstances such as health problems, the death of the breadwinner, loss of employment and business failure.





As of July 31 (2016), 10,704 DMP participants successfully completed the programme. The success rate is expected to continue as more participants will benefit from the restructuring of their financial commitments.

AKPK is a wholly-owned subsidiary of Bank Negara which was established in April 2006. It provides an avenue for individuals to seek advice and assistance in managing their finances and debts.

AKPK offers free services, including financial education on the prudent use of the credit card and basic money management skills; counselling and advice on financial management, including financial budgeting to manage expenses and DMP to assist financially distressed consumers in managing their finances.

Since its inception, AKPK has made significant progress, especially with the expansion of its outreach programmes through state branches to make its services available to a wider segment of the population.

AKPK’s consumer education programmes aim to nurture financially astute borrowers and promote good payment and repayment culture.

The programme includes ad-hoc tailor-made talks and briefing to various targeted groups, personal financial management education (which mainly targets university students) and POWER! Programme, which is designed to equip individuals with essential financial knowledge and ability to make responsible financial decisions.

The FEP (Financial Education Programme) modules comprise 10 topics which are commonly related to debt issues.

From 2006 until 2014, the FEP was designed for various target groups such as retirees, students from higher learning institutions, newly-employed individuals and newly-married couples.

However, beginning 2014, AKPK introduced the POWER! Programme, which encompasses all 10 topics into a single module. Moving forward, it is important for the rakyat to be aware on the need to manage their finances wisely and prudently.

Meanwhile, the Government needs to intensify efforts to enhance financial literacy, especially among the younger generation to create a financially savvy society.