Households in Malaysia fork out half of income to resolve debts
By Sebastian Loh, 4/27/2011
Unbelievable. According to the Consumers Association of Penang (CAP), Malaysian households use around half their incomes to resolve debts.
The Star, a Malaysian daily, reported on the rather shocking revelations highlighted by CAP.
The ratio of debt expenditure to disposable income (debt service ratio) for the typical Malaysian household sat at a mind-boggling 47.8% in 2010.
CAP president S.M. Mohamed Idris said he drew that worrying statistic from Bank Negara’s Financial Stability and Payment Systems Report for 2010.
“After clearing their debts, there isn’t much left for food, transport, education and emergencies,” he said.
Here are some other facts he mentioned:
- On average, a Malaysian household’s loan was 1.4 times more than earnings.
- Ratio of Malaysian household debts to disposable income: 140.4% (Idris cited a business magazine) Compare this to other countries: USA – 123.3%, Singapore – 105.3%, Thailand – 52.7% (2009 statistics)
Source: http://news.malaysia.msn.com/regional/article.aspx?cp-documentid=4801997
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