The Federation of Malaysian ConsumerAssociations has proposed the setting up of a financial education commissionto help reduce household debt, estimated at RM560 billion last year.
Fomca says the commission would educate consumers on financial products and services and show them how to make informed choices.
Fomca cites studies showing that 50 per cent of credit card holders declared bankrupt were below 50. According to data from the national Credit Counselling and Debt Management Agency, 22 percent could not pay their debt due to poor financial management.
“In conjunction with World Consumer Rights Day on March 15, Fomca suggests that a commission be formed under the Finance Ministry, which will be responsible for stepping up financial management education among consumers,” Fomca says.
Without basic financial knowledge, consumers will end up buying financial products and services they may not need. According to Fomca, the commission should focus on raising public awareness of their rights, fostering cooperation between the public and private sectors, and studying and evaluating financial education programmes.