LETTER | The recent reports on youth debt in Malacca are a wake-up call for all of us.

It has been recorded by the Credit Counselling and Debt Management Agency (AKPK) that over 1,900 youths in our state are in debt to the tune of RM138 million collectively.

Financial struggles are not only eroding their quality of life but also threatening their prospects. As leaders and stakeholders, we must act decisively to address this growing crisis.

The root causes of youth debt - poor financial literacy, lax lending practices, and insufficient support systems - must be tackled head-on. To do so, Malacca DAP Youth proposes three initiatives to be conducted.

1. Teach financial literacy early in schools

Financial accountability is a skill that should be developed early in life. We call for the introduction of age-appropriate financial literacy education in primary and secondary schools.

This should include practical lessons on saving, budgeting, and understanding credit. By equipping our youth with the tools to make informed financial decisions, we can prevent them from falling into debt traps later in life.

2. Stricter lending regulations to be enforced

Financial institutions must take more responsibility in ensuring loans are only granted to individuals with a proven ability to repay them. We urge the government to tighten regulations around personal loans, credit cards, and “Buy Now, Pay Later” schemes.

This includes requiring stricter credit checks and setting clear affordability guidelines to prevent vulnerable individuals from taking on debt they cannot manage.

3. Empower AKPK to address the problem at its source

AKPK has been a vital resource for those struggling with debt, but more can be done to empower the agency to act proactively. AKPK should be given the mandate and resources to expand its outreach efforts, especially to young people at the start of their financial journeys.

This includes providing pre-loan financial counselling and working with schools and universities to educate students about responsible financial management.

The youth of Malacca are the backbone of our state’s future. If they are burdened by unmanageable debt, their ability to contribute to society and achieve personal success will be severely hindered.

Addressing this issue requires a collaborative effort between government agencies, educational institutions, financial bodies, and civil society.

As Malacca DAP Youth, we are committed to advocating for these reforms and working to ensure that our youth are given the tools and opportunities they need to thrive financially and personally.

The time to act is now, before this debt crisis grows even further out of control.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.