In less than a week, Muslims in Malaysia will celebrate Hari Raya Aidilfitri. The Aidilfitri celebration holds significant importance for Muslims after observing the noble act of fasting during the month of Ramadan. At this juncture, we are approaching the final stretch of Ramadan, where Muslims are encouraged to increase their acts of kindness. Concurrently, we also need to be more vigilant regarding loan sharks’ activities, which undoubtedly will be more rampant and widespread, taking into account financial needs, especially in preparation for Hari Raya Aidilfitri. It is well-known that during this time, the cost of living is increasing, and the prices of certain raw goods are somewhat challenging to control. Simultaneously, the wages earned by Malaysians are not proportional to the increasing household expenses caused by the rising cost of living, which affects household expenditure.
In the context of Hari Raya Aidilfitri celebrations, household spending is likely to increase during the festive season compared to other months. This is due to expenses related to Hari Raya Aidilfitri preparations, potentially resulting in higher spending compared to income. If this happens, individuals may dip into their savings to cover expenses. However, do all Malaysians have savings? According to a survey by the Financial Education Network (FEN), 84% of Malaysians do not have regular savings every month. This means there’s a possibility that some Malaysians will resort to bank loans or cooperatives to cover the excess spending compared to their income. Some may also borrow from family members and close friends.
Nevertheless, what’s more concerning is the possibility that some individuals may feel pressured to the extent of resorting to loan sharks. This is a worrying issue, as borrowers will face more problems and pressure if involved with loan sharks. With the current pressure, including the rising prices of daily necessities, more people are forced to cut back and ration food due to the increased prices of certain goods and the shortage of food supplies.
What’s even more worrisome is that there are parties, especially loan sharks, taking advantage of the pressure faced by the people by offering loans with exorbitant interest rates. All of this is due to the desperate situation, and after taking such loans, it will only bring more problems and pressure to the borrowers, especially mental pressure that can affect performance at work and the quality of life with family.
Recently, the media reported that the Royal Malaysia Police (PDRM) have successfully uncovered loan sharks’ modus operandi, including forcefully seizing borrowers’ cars. This modus operandi is deeply concerning and needs to be addressed promptly to prevent its proliferation. Malaysians need to be vigilant and avoid involvement in any usurious activities that could potentially entrap us in prolonged financial difficulties with no way out. It’s better to spend only on essential items according to our financial capabilities and to avoid taking personal loans, especially from loan sharks, which could disrupt the peace of mind of Malaysians.
The author is intrigued by the lyrics penned by Ustaz Pahrol Mohamad Juoi in the song titled “Suci Sekeping Hati,” which goes, “Jalannya tak seindah sentuhan mata,” carrying profound meaning reflecting the reality and facts faced by some people amidst the pressures caused by the rising cost of living.
It’s crucial to implement fair wages that align with the current situation by considering the increased cost of living. We need to steer clear of loan sharks and spend based on our individual capabilities.
Assoc Prof Dr Anuar Shah Bali Mahomed
5 April 2024