KUALA LUMPUR — The Dewan Rakyat today passed the Consumer Credit Bill 2025, aimed at protecting the interests of credit consumers and closing regulatory gaps in Malaysia’s unlicensed credit sector.

Deputy Finance Minister Lim Hui Ying said the legislation was introduced to address the risks faced by vulnerable consumers in an industry that has long operated with minimal oversight.

The bill, which seeks to harmonise the fragmented consumer credit landscape, was unanimously approved following debate by 24 Members of Parliament.

A key feature of the law is the establishment of the Consumer Credit Commission (CCC), which will regulate credit businesses that currently operate without a licence or formal supervision.

“The Consumer Credit Act 2025 will serve as a master act that complements existing legislation overseen by various authorities and regulators. It will not duplicate the roles or functions of ministries and agencies,” Lim said during her wrap-up speech.

These agencies include the Ministry of Housing and Local Government (KPKT), the Ministry of Domestic Trade and Cost of Living (KPDN), the Malaysia Co-operatives Commission, Bank Negara Malaysia (BNM), and the Securities Commission Malaysia (SC).

She said the government would adopt a phased approach in implementing the act, based on the readiness of the industry and the progressive strengthening of the CCC.

In Phase 1, KPKT will oversee compliance by licensed moneylenders with the new consumer protection provisions introduced under the act.

It will also gain an additional legal mandate to regulate syariah-compliant financing, including loan and pawnshop services.

Meanwhile, KPDN will amend provisions in the Hire Purchase Act 1967 to enhance consumer safeguards and modernise the law.

On interest rates, Lim said the government would not impose any cap in the initial phase.

“We will not set (interest rates) in Phase 1… however, we need to collect data in Phases 1 and 2,” she said.

Phase 2, expected to begin in 2028, will see the transfer of regulatory functions from KPKT and KPDN to the CCC. This includes oversight of moneylending, pawnshops, hire purchase, and credit sales.

Phase 3, targeted for 2031, will involve a full consolidation of all consumer credit regulation under the CCC following a comprehensive review. — July 21, 2025