Borrowers won't have to make immediate repayments under new credit rules: MAS
- POSTED: 04 Jun 2014 13:17
- UPDATED: 04 Jun 2014 14:22
MAS has assured borrowers that they do not have to make immediate repayments under the new unsecured credit rule.
SINGAPORE: The Monetary Authority of Singapore (MAS) on Wednesday (June 4) assured borrowers that they do not have to make immediate repayments to their financial institutions under the new unsecured credit rule.
The central bank statement comes following concerns by consumers that their lending institutions may require them to make immediate repayments if they are assessed to have borrowed beyond their means.
Instead, MAS told the media that it expects banks to work out reasonable repayment plans with such borrowers. It also encouraged affected borrowers to approach their financial institutions early to discuss possible repayment plans.
The concerns were raised after MAS announced new credit card and unsecured credit rules in September last year. From this month, banks are to review a customer's total unsecured and secured debts across all financial institutions before granting a new credit card or unsecured credit facility.
Under the new rules, financial institutions may also conduct fresh credit assessments to review existing facilities. The banks can also discuss with borrowers who have high levels of debt how they can reduce their debt burdens.