KUALA LUMPUR, Sept 11 — Tan Sri Muhyiddin Yassin has proposed today that Putrajaya offer a special moratorium to small and medium enterprises (SMEs).

The former prime minister said the sector had yet to fully recover from the Covid-19 pandemic.

He added this situation, coupled with the increase of the overnight policy rate (OPR) three times this year, meant that the industry would need more time to deal with any debt incurred.

"I have sent a proposal to the government on a special moratorium for all SMEs.

"This sector represents 96 per cent of the economy and countless citizens rely on it as their source of income. Almost 50 per cent of Malaysia’s workforce are part of the SME sector.

"Just like previous moratoria, the country’s banks will not incur losses either. Hence, there is no reason for the government not to discuss this matter with the financial institutions so they can introduce this special moratorium for SMEs,” he said in a Facebook posting.

On September 8, Bank Negara Malaysia’s Monetary Policy Committee announced the highest and lowest corridor rates for the OPR, increasing them to 2.75 per cent and 2.25 per cent, respectively, which is the third increase this year after increases in May and July.

The move triggered public concern about the possibility of higher loan repayments.