MONEY

Nearly 50 per cent of credit card holders declared bankrupt were under 30 years of age, according to figures from Bank Negara Malaysia (BNM).

Also, a study conducted on those who had defaulted on their debt payment or had difficulty in servicing their debt found that 22 per cent of the respondents attributed their predicament to poor financial planning.

The study conducted by the Credit Counseling And Debt Management Agency (AKPK), a wholly owned subsidiary of BNM, also found that some 27 per cent of the respondents cited that they lost control on usage of their credit cards.

Another survey conducted by Citibank showed 37 per cent of the respondents were worried about their financial future and on average Malaysians had savings that could last only 11 weeks.

The survey findings also showed that only 28 per cent kept to their budgets and that only 22 per cent have a clear retirement plan.

Datuk N.Marimuthu, president of the Federation of Malaysian Consumers Association (Fomca) shared the above startling findings with Bernama as he spoke in conjunction with World Consumer Rights Day to be celebrated on March 15.

The theme for this year is "Our Money Our Rights".

FINANCIAL PLANNING

According to Marimuthu, another study carried out by CIMB found that 93 per cent of the respondents indicated that they were aware that they need financial planning.

Personal financial planning where budgeting is the key component should be at the back of everyone's mind but judging by the findings of various studies, very few Malaysians can actually adopt one.

In the 2010 Budget, the government announced an annual service tax of RM50 will be imposed for each principal credit card and RM25 for each supplementary card in an effort to encourage prudent spending.

SET TARGET

"Thus our first focus in conjunction with World Consumer Rights Day is to further enhance financial skills and to instill financial responsibility in all consumers. Our particular focus is children and youths," Marimuthu told Bernama.

The reason being, as aptly put by the Fomca president, consumers must be trained early to acquire good consumption and financial habits.

"Once they acquire bad spending habits, it becomes extremely difficult to change.

"Our ultimate aim is to enhance financial literacy skills including skills in financial planning, budgeting, retirement planning, and mindful consumption," he elaborated.

MEDIA LITERACY

Educating youths to better understand how media can influence their consumption is part of Fomca's mission to help consumers.

According to Marimuthu some youths were so taken by deceptive advertising tactics that they were pushed to the edge of incurring excessive expenditure.

Youths, he said are also easy prey for junk and unhealthy food promotions, leaving more and more youngsters to deal with issues of overweight and obesity.

"Through better media literacy, youths can be better armed to some extent to minimise impact of media on their values, personal self-esteem and their consumption behaviours," said the Fomca president.

FINANCIAL INSTITUTIONS

In line with the "Our Money Our Rights" theme, Fomca also wants banks and other financial institutions to increase their quality of service to the consumers.

In 2008, the National Consumer Complaints Centre (NCCC) received 1,354 complaints against banks and financial institutions.

This was an increase of 67 per cent from the year 2006.

Marimuthu who is also the Chairman of Board of Directors of the NCCC said complaints received include misleading advertisements, excessive interest, charges and penalties besides one-sided agreement with the consumers finding themselves at a disadvantage.

Another complaint received by the NCCC centred on aggressive debt collection tactics.

"Consumers want banks especially to be more caring and responsible in dealing with them.

"Bank Negara as the regulator of the financial services should take concrete measures to efficiently and effectively regulate the banks to better protect the interests and welfare of the consumers," said Marimuthu.

MORE FOR THE POOR

The poor and the weaker segments of the community must also have access to financial services.

The Fomca president proposed micro-credit and special credit schemes to be made available to the poor especially in helping them to get out of the clutches of poverty through small business ventures.

Skill development and entrepreneurship training should be undertaken to empower them to break away from poverty.

Additionally, there should be access to loans or small grants to enable them to start their own business, said Marimuthu.