Indirect factors affecting Malaysian personal insolvency

Rising indebtedness can unfavourably influence economic monetary development as it successfully evacuates people from participating or contributing to the economy of a country. Spending more than their means and with poor personal financial planning and managing financial resources would possibly be the causing formula for enormous amount of debt. Hence, the purpose of this study is to investigate the issues of Malaysian personal insolvency. The study attempts to analyse the interrelationship between personal insolvency and indirect factors. The data of this research were obtained from Agensi Kaunseling Pengurusan Kredit (AKPK) data on 2016 using Statistical Package for Social Sciences (SPSS). The novelty of this research is a classification of affecting of personal insolvency into indirect factors such as gender, age, marital status and race. This study analysed that male genders, married people, age between 30-40 years old and Malay category are the most influencing factors that affect the personal insolvency in Malaysia. Therefore, AKPK should continue to embark and put this issue under the spotlight. The pre-emptive measures and collaboration with government agencies, private companies, financial institutions, cooperatives and other credit providers are important to help the individuals take control of their financial situation and gain peace of mind from wise use of credit. Intended for the borrower, setting financial goals is an important step forward in reaching the financial independence and accountable in handling the spending wisely