Consumer Credit Bill 2025 Passed, Regulating Commission To Be Set Up
KUALA LUMPUR, July 21 (Bernama) -- The Consumer Credit Bill 2025 was passed in the Dewan Rakyat today to protect the interests of credit consumers in the country.
Deputy Finance Minister Lim Hui Ying said the bill was enacted to address significant gaps in the unregulated industry, particularly businesses that target vulnerable credit consumers who are susceptible to exploitation.
The bill also aims to standardise the regulatory framework in the currently diverse consumer credit landscape in Malaysia.
The bill was unanimously approved after debate by 24 members of parliament.
Under the Consumer Credit Act 2025, the Consumer Credit Commission (CCC) will be established to regulate credit businesses that currently operate without a licence or specific monitoring.
“The Consumer Credit Act 2025 will be framed as a master act that is complementary to existing acts under the administration of authorities, regulators and supervisors, and does not duplicate the functions or roles of existing ministries and agencies.
“This includes the Ministry of Housing and Local Government (KPKT), the Ministry of Domestic Trade and Cost of Living (KPDN), the Malaysia Cooperatives Commission, Bank Negara Malaysia (BNM) and the Securities Commission Malaysia (SC)," she said when winding up the debate.
She explained that the integrated regulatory approach will be implemented in phases by taking into account the readiness of the industry and the capabilities of the CCC which will be enhanced from phase to phase.
For Phase 1 preparations, she said, KPKT as the regulatory and supervisory authority will ensure that licensed money lenders comply with the aspects of credit consumer protection introduced through the act.
With the enactment of the act, KPKT will receive an additional legal mandate to regulate syariah-compliant businesses for both sectors, namely the regulation of loans with pawnshops. KPDN will also amend several provisions in the Hire Purchase Act 1967 to strengthen consumer protection and modernise existing provisions.
Commenting on the maximum interest rate charged by credit businesses, Lim explained that the government will not set any interest rate cap in phase 1.
“We will not set (interest rates) in phase 1... however, we must collect data in phase 1 and 2,” she said.
In phase 2, which is expected to start in 2028, the regulatory functions currently held by the KPKT and KPDN will be transferred to the CCC. This includes money lending, pawnshop business, hire purchase and credit sales activities.
Meanwhile, phase 3, targeted to begin in 2031, will focus on the regulatory consolidation of all consumer financial activities under one centralised entity after a comprehensive review by the government.
-- BERNAMA