Tuesday, March 05, 2013

What is AKPK? Is It Really Needed?

AKPK stands for "Agensi Kaunseling dan Pengurusan Kredit" in Malay and in English, it is known as Credit Counselling and Debt Management Agency. I only know about this organization lately when I was trying to solve a debt problem for a relative. So I just share to you guys and this is only applicable in Malaysia.

This organisation is wholly owned subsidiary of Bank Negara Malaysia (National Bank of Malaysia) that basically provides help to anyone who has problem managing their own financial. The financial problems that I have seen so far are usually due to credit card debt. What you need to do is contact them and explaining your debt situation and they will help you to restructure your debts by negotiating on behalf of you with banks. For example, instead of paying for 18% interest, you may just need to pay for 9% after debt restructuring. Cool, isn't it? This service is called AKPK’s Debt Management Program (DMP).

There are 2 key exceptions where you can't enroll in DMP:

  • You must have a job or income. If no, you should get a job first before approaching AKPK.
  • Your debt must be legal and approved by Bank Negara Malaysia.

I think these requirements make sense because there is no way to manage your debt if you don't have income at all. Also, your debt can't be from "Ah Long" (Loan Shark). I cannot imagine how they can negotiate on behalf of you. :) But I guess if you really can't meet these requirements, you still can seek help from them on what to do next.

The only drawback of enrolling this DMP is you can't apply any kind of loan anymore unless you settle all the debts. I think this is good thing but some debtors may disagree because it constraints them from borrowing more. Hello, please wake up!

For the details, please visit: www.akpk.org.my. Look for Debt Management under the services category.

Wait! I Still Don't Get It

It may appear that AKPK is solution to many people who have credit card debt issue BUT let's think of it deeper again, why can't this be prevented before even going to AKPK stage? Can this be done?

Most credit card debtors (who fail to manage their debt) that I have seen so far  hold 5 to 6 credit cards. Why this is allowed?  Even 2 credit cards are consider a lot already in my opinion. I personally just hold 1 credit card. The question is why banks allow them to hold more than 5 credit cards at the first place? Another way to look at this is the maximum debt limit a person can borrow. For example, this person debt limit is $20K and it should always gap at $20k no matter how many credit cards he/she can hold. Can we set such rules?

If this problem be prevented, why this is not happening? Why must Bank Negara (National Bank) creates a solution while the problem can be prevented? Are they creating solutions that look for problems and ultimately create the problems by themselves if they don't exist? Are they doing this in purpose?

Oh okay I know, because banks want to earn too. They are in business and yet help to grow economy at the same time by encouraging people to spend over their limit if possible! This is how economy works? Win-win situation between Bank Negara (National Bank) and the rest of the banks. But wait, is the debtor win too?

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