MPN chairman Muhyiddin Yassin said the recommendation was made after the council held three meetings to discuss SMEs.
He added that these businesses have, among other things, asked for financial assistance since some of them are still unable to recover while their business continued to decline.
This is coupled with the increase in the overnight policy rate (OPR) three times this year, which is seen to not only affect the momentum of the country’s economic recovery but also the performance of SMEs, which now contribute to 90% of the country’s economic activity, the former prime minister said.
“In the last MPN meeting, the SMEs requested that the banks look into the possibility of introducing another special moratorium. I believe even with another moratorium, the banks will not lose much.
“If the SMEs want to borrow money, the banks asks them to first settle the earlier loan. Now, the OPR has gone up. So, if the SMEs want to borrow again, the banks will ask for a track record of their business for the past year or two, and this will likely show a loss.
“The point is that based on normal conditions, these SMEs will never recover,” he told reporters after the Jualan Prihatin Rakyat in Bukit Pasir here today.
Muhyiddin, who is also Pagoh MP, hopes that the government will see the impact on the SME sector which is seen as one of the main drivers of the national economy.
“The OPR increase will have an impact. The MPN is paying attention to, among other things, the issue of poverty and the recovery of the economic sector, especially SMEs.
“The recovery is also getting slower with the burden of costs, the increase in the inflation rate, and so on. It is a big problem,” he said.
Muhyiddin also hoped that the government will look at the increase in the OPR while finding a way to help reduce the burden on the people in Budget 2023 which is to be tabled next month.
“For me, if there are no decisive steps presented in Budget 2023, then it will not have any impact and will not help speed up recovery and help ease the burden of the people,” he said.
Two days ago, Bank Negara Malaysia’s Monetary Policy Committee announced the highest and lowest corridor rates for the OPR, increasing them to 2.75% and 2.25%, respectively, which is the third increase this year after increases in May and July.