SHAH ALAM – Experts have proposed nine proactive measures aimed at curbing debt addiction, particularly among individuals aged 45 and below, who are the leading contributors to Malaysia's rising bankruptcy rates.
Universiti Malaya Asia-Europe Institute Distinguished Economics Professor Datuk Dr Rajah Rasiah said that the government’s primary focus in reducing bankruptcy should be to identify the root causes of entrepreneur insolvency through a comprehensive study.
"The government needs to tighten the loan approval assessment process for entrepreneurs and ensure that loans are only granted following a thorough verification of their financial standing.
"Furthermore, the government should provide educational channels in finance, accounting, human resource management, marketing, commercial law and contracts, especially for entrepreneurs with less than three years of experience,” he said.
Rajah added that the government should also create digital platforms for new entrepreneurs so that their participation in the learning process could be conducted online.
"They need to establish an incubator system to mentor young entrepreneurs, selecting universities and National Technical and Vocational Training (TVET) institutions to provide financial management guidance to them.
"In efforts to raise awareness among entrepreneurs about the importance of management, advanced global and national practices should be incorporated. The government can also re-evaluate current awareness and teaching methods to ensure continuous improvement in these approaches.
"These steps are expected to help reduce the bankruptcy rate among young entrepreneurs and enhance their competitiveness,” he said.
Previously, the Malaysian Department of Insolvency (MdI) revealed that individuals aged between 35 and 44 contributed the highest to the national bankruptcy rate, with 10,489 cases or 38.98 per cent of the total cases recorded between 2020 and March 2024.