3.6 Million Credit Card Holders Have RM36.9 Billion Outstanding Balance

by Brian Riley 0

 Regulators in yet another market throw up a flag on credit card debt. Malaysia, a market the US CIA defines as the 42nd largest by population, with a GDP per capita of $27,200 (USD), ranked 69th in the world, reports that more than 7.3% of credit card balances are overdue. According to the Deputy Finance Minister, Lee Chee Leong:


• 7.3 per cent was due to overdue balances owed by creditors.

• “The remaining breakdown over the payment date are as follows; firstly, outstanding balance that not exceeding three months is 6.2 per cent worth RM2.3 billion.

• Lee said on an average, 43.6 per cent of total cardholders settled their credit card debt completely in the January to June 2017 period, while another 43.6 per cent pay up at least five per cent of the outstanding balance in the same period.

• He adds that the remaining 12.8 per cent are cardholders who do not pay even the minimum payment of their outstanding balance before or within the due date.

So, perhaps trouble is brewing in paradise. Credit cards are easy to assimilate into markets but their growth must be held to performance standards. Once delinquencies get out of control, it takes years, and billions in losses to contain. Over the past few months, we’ve seen signs of concern from Canada to the United Kingdom. Here is a small developing market showing stress fractures.

Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group

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