Pawn Shop Issue amidst CMCO

The conditional movement control order (CMCO) which was enforced in conjunction with the reopening of the economy on May 4 has brought to the sight of long queues at pawn shops across Malaysia.

Malaysians were seen to pawn off their valuable goods in a desperate bid to ensure they have enough money to sustain life due to the Covid-19 pandemic.

Previously, on April 9, it was reported that the Credit Community and the pawnbroker’s association have agreed to a three-month moratorium to ease the burden of borrowers following the announcement on Prihatin Tambahan on April 6, 2020.

Housing and Local Government Minister, Zuraida Kamaruddin also said that the licensed moneylenders registered with the housing and local government ministry (KPKT) had agreed to not impose any late charges or fees during the movement control order (MCO) period.

However, issue started to arise when the Federation of Malaysia Consumers Association (Fomca) received complaints of some pawn shops imposing charges during MCO.

Due to this, Fomca has called out KPKT to monitor the pawn shops that were charging the consumers.

Saravanan Thambirajah who is the Fomca chief operating officer implied that some pawn shops have ‘breached’ the promise made by the Malaysia Pawnbrokers Association of not imposing charges for three months (March 18 to May 12).

To this, he added that Fomca had received many complaints from the consumers who have pawned their valuable items and were asked to pay charges up to nine months.

Because of this, Fomca has urged KPKT to take the necessary actions in order to protect these consumers who were mainly from the low-income groups.