KUALA LUMPUR, March 23 — The number of civil servants taking new personal loans has reportedly increased by 10 per cent to around 70,000 individuals, ahead of this year’s Hari Raya Aidilfitri celebrations.
Utusan Malaysia quoted National Cooperative Movement of Malaysia (Angkasa) president Datuk Seri Abdul Fattah Abdullah saying this annual trend is linked to increased financial needs during festive seasons and other key periods.
“The desire to celebrate Aidilfitri in a grand manner also causes some to overspend,” he was quoted saying.
“This is especially evident in efforts to fulfil family needs and societal expectations. Expenses such as new clothes, special dishes, duit raya, and travel costs add to the financial burden, especially for those with families.”
He also warned against borrowing money for unnecessary purchases, such as new furniture or cars, to impress others during the festive season.
Abdul Fattah said such personal loans spike also happen during times such as the start of the school term and university enrolments.
He noted that many civil servants, particularly those in the lower- and middle-income groups, lack emergency savings, leading them to rely on loans.
Abdul Fattah urged civil servants to manage their finances wisely and not take loans exceeding 60 per cent of their monthly income.
He also warned against borrowing money for unnecessary purchases, such as new furniture or cars, to impress others during the festive season.
“This ensures they do not face long-term financial difficulties. The 60 per cent salary deduction cap is a guideline set by the government through the Public Service Department to ensure civil servants have enough income for essential needs,” he said.
This comes as the Chief Secretary to the Government Tan Sri Shamsul Azri Abu Bakar previously advising civil servants to spend within their means to avoid excessive debt.
He warned that under Sub-Regulation 13(7) of the Public Officers (Conduct and Discipline) Regulations 1993, accumulating debts exceeding 10 times one’s monthly salary is an offence and could result in disciplinary action.
