By Siti Rohaizah Zainal
SHAH ALAM, Oct 11 – Yayasan Hijrah Selangor has implemented stricter conditions on borrowers, such as requiring them to furnish six months of bank statements and a guarantor for high-risk financing, after over 30,000 people failed to repay their loans on time.
Its chief executive officer Dato’ Mearia Hamzah said the state agency has shouldered RM206 million in non-performing loans (NPL) from 2015 to December 2023.
This has affected its ability to offer microcredit financing of up to RM50,000 to other entrepreneurs in need.
“Our aim in introducing these new conditions is to ensure entrepreneurs are disciplined in making their loan repayments. The enhanced documentation now includes an individual credit report assessment (CTOS).
“We also require six months of bank statements and a guarantor for high-risk financing. If there are claims that Hijrah Selangor is operating like a bank, that is not true,” she told Media Selangor.
Mearia clarified that these measures are meant to safeguard its lending operations and not to impose bank-like practices.
She added that there are no restrictions preventing borrowers with outstanding National Higher Education Fund Corporation (PTPTN) debts from securing business financing.
She was responding to a viral claim on Telegram that Hijrah Selangor is imposing stringent loan approval criteria, including prohibiting applicants with CTOS records or PTPTN debts from receiving financing.
[caption id="attachment_350562" align="aligncenter" width="1200"]
Yayasan Hijrah Selangor chief executive officer Dato’ Mearia Hamzah speaks at the memorandum of understanding signing between the Credit Counselling and Debt Management Agency and Yayasan Hijrah Selangor to provide counselling to Hijrah Selangor’s distressed borrowers, at the State Secretariat Building in Shah Alam, on March 20, 2024. — Picture by AHMAD ZAKKI JILAN/SELANGORKINI[/caption]
Mearia said Hijrah Selangor has launched several initiatives to assist borrowers in repaying their loans, including a debt management programme run by its internal collection unit.
These efforts have resulted in a 14 per cent reduction in NPL, amounting to RM29 million, bringing the total NPL to RM177 million as of September.
“We have also restructured repayment schedules, extending the repayment period from three to five years to alleviate borrowers’ financial burdens,” she said.
Earlier this year, Mearia announced Hijrah Selangor was intensifying efforts to collect over RM100 million in unpaid loans to allow the agency to provide financing to new borrowers.
Meanwhile, she expressed hope that Hijrah Selangor will be given an increased allocation in the upcoming 2025 Selangor State Budget to allow the agency to assist more entrepreneurs.
She said at present, Hijrah Selangor can only provide loans up to RM60 million a year from RM90 million previously.
“We hope in the upcoming budget, the state government will provide an additional boost with an increase of RM20 million.”
The 2025 Selangor State Budget is set to be tabled by Menteri Besar Dato’ Seri Amirudin Shari on November 15 during the final sitting of this year’s Selangor State Legislative Assembly, which will end on November 29.
Previously, Amirudin said the budget would outline several new challenges to maintain the state's momentum as the nation's largest economic contributor.
He said his administration aims to advance the digital sector, particularly artificial intelligence (AI) technology, through the establishment of the first AI development centre in Selangor.
