Bank Negara Malaysia Introduces New Rule: Financial Education Mandatory for Personal Loans Above RM100K

IFCCI Editorial · Communications1 October 2025

KUALA LUMPUR, Oct 1, 2025 —
Bank Negara Malaysia (BNM) has officially announced that starting immediately, all individuals applying for personal loans exceeding RM100,000 must complete a financial education course before their applications can be approved.

Promoting Responsible Borrowing

According to the central bank, this policy aims to strengthen financial literacy, reduce the risks of over-indebtedness, and encourage responsible borrowing. Borrowers will be required to complete a certified financial education module to better understand loan obligations, repayment strategies, interest rate structures, and the risks associated with large borrowings.

Part of Broader Financial Reforms

This initiative is part of BNM’s wider efforts to address Malaysia’s rising household debt. Recent data shows that personal financing and credit card loans are among the main contributors to household leverage, raising concerns over long-term financial stability.

By making financial education mandatory, the central bank hopes to empower consumers with the knowledge needed to make informed financial decisions and reduce default risks.

Industry and Public Reactions

Financial experts have welcomed the move as a progressive step aligned with global best practices. Consumer associations also praised the initiative, highlighting that many Malaysians often underestimate repayment commitments when taking large loans.

However, some industry players noted that banks will need to adjust their loan processing systems to integrate the mandatory education requirement effectively.

IFCCI’s Perspective

The International Financial Consultant Certified Institute (IFCCI) supports this regulation, emphasizing that structured financial education is an effective tool in combating irresponsible borrowing habits and financial scams. By ensuring borrowers fully understand their financial commitments, the policy will strengthen household resilience and contribute to national financial stability.

Source: Bank Negara Malaysia (BNM)