Malaysia's new consumer-credit committee agrees to work toward a single regulator for non-bank lenders

Implications for lenders

Lenders that outsource collections or sell impaired portfolios in Malaysia may need to confirm that their agencies and buyers are registered with SKP, whose agencies must hold RM500,000 in equity or an insured alternative. Moneylenders, pawnbrokers and non-bank hire-purchase providers can review flat-rate and Rule of 78 pricing and disclosures now, since Phase 2 would bring them under SKP.

Implications

Facts

Committee: SKP said on 28 October 2026 that it had formed an Advisory Committee under the Consumer Credit Act 2025, as provided for in the Act. It is chaired by SKP's executive chairman and brings together senior representatives of the Ministry of Finance, the Ministry of Housing and Local Government (KPKT), the Ministry of Domestic Trade and Cost of Living (KPDN), the Ministry of Entrepreneur and Cooperatives Development, Bank Negara Malaysia, the Securities Commission and the Malaysia Co-operative Societies Commission. It held its first meeting the same day.

Pricing: the meeting discussed moving from flat-rate and Rule of 78 calculations to the effective interest rate. SKP will apply this to the credit providers it oversees, and KPDN will do so for hire purchase through amendments to the Hire-Purchase Act.

Collection and Shariah products: each ministry and agency will ensure that industries under its supervision use only debt collectors and purchasers of impaired loans registered with SKP. KPKT will develop a framework for Shariah-compliant consumer credit products.

Direction: members agreed to work toward placing non-bank consumer credit providers under a single regulator and to identify preparatory steps for Phase 2 of the Act, which covers moneylenders, pawnbrokers, Ar-Rahnu providers and hire-purchase providers under SKP. The release gives no timeline for Phase 2.

Analysis

Time series: the meeting extends a sequence of pricing and conduct changes in 2026. The amended Hire-Purchase Act took effect on 1 June, and by September 14 of 20 banks offered reducing-balance hire purchase. ¹ Phase 1 licensing for BNPL, leasing, factoring, debt collection and other activities opened on the same date. Phase 2 would add hire-purchase providers outside the banks; the industry association counts 429 registered operators. ²

Collections: SKP already requires registered debt collection agencies to hold RM500,000 in equity, or a lower amount combined with professional indemnity insurance. ³ Extending the registered-collector rule across all supervised industries would make that registration a condition for using a collector or selling impaired loans, not only for collectors in SKP's own sectors.

Cross-country: the Philippine SEC has proposed accreditation for third-party collection agencies, with one year for existing agencies to comply after the rules take effect. ⁴ Both markets are moving collection oversight from the lender's contract to the regulator's register.

Counterpoints and uncertainties

The outcomes are agreements to work toward goals; the release gives no date or legal text for Phase 2 or for the single-regulator plan, and the Shariah framework is still to be developed. Moving moneylenders and pawnbrokers from their current ministries to SKP may require further legislation, which could take time.