KUALA LUMPUR (Aug 13): Malaysia’s household debt stood at RM1.65 trillion as of end-March 2025, equivalent to 84.3% of gross domestic product (GDP) as at end-March 2025, a level that remains elevated but is balanced by strong household assets. 

Deputy Finance Minister Lim Hui Ying said that the household sector remain resilient backed by their financial assets amounting to RM3.45 trillion as at end-March 2025, which was 2.1 times higher than total debt.

“As of end-2024, the median debt service ratio for household loans stood at a prudent 34%,” Lim told the Dewan Rakyat during the oral question-and-answer session on Wednesday.

Debt service ratio measures how much of a person’s income goes toward paying loan repayments.

Household debt was slightly higher than RM1.63 trillion at end-2024, indicating steady growth in household borrowings amid stable economic growth. At 84.3% of gross domestic product (GDP), Malaysia's household debt remains among the highest in Southeast Asia, trailing behind Thailand. 

Of this, 61.1% comprised loans for the purchase of residential properties, Lim added.

She was responding to Abdul Latiff Abdul Rahman (PN–Kuala Krai), who had asked about government measures to address rising household debt — particularly among civil servants, and the control mechanisms in place to safeguard household financial stability.

On civil servants, Lim said a total of 4,194 bankruptcy cases involving public officers were recorded between 2020 and June 2025, representing just 0.3% of the 1.6 million-strong workforce.

She noted that Regulation 13 of the Public Officers (Conduct and Discipline) Regulations 1993 stipulates that a civil servant’s monthly net pay must remain above 40%, and that they must not be in serious financial indebtedness.

Lim said that through the Credit Counselling and Debt Management Agency (AKPK), various financial advisory and debt management services are provided, including debt restructuring programmes for individuals in need.

The Public Service Department (JPA) has also implemented strategic measures through the Mind Transformation Programme (PTM) to give new civil servants early exposure to personal financial management, she added.

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