The minimum debt for which a person can be made bankrupt will be raised from RM100,000 to RM150,000, Minister in the Prime Minister’s Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said told the Dewan Rakyat on 26 October.
Winding up the Budget 2027 debate for her portfolio, Azalina said the change, first announced when the budget was tabled on 9 October, is intended to reduce the risk of bankruptcy and give debtors room to reorganise their finances.
She said 253,457 bankruptcy discharge cases were recorded from 2023 to September 2026.
The government is also stepping up recovery efforts under its second-chance policy. The Fast Track Discharge Programme 2026 gives priority to single parents, scam victims, buyers of abandoned housing projects and borrowers from micro, small and medium enterprises.
Eligible applicants can complete the fast-track process within 36 days, subject to conditions and provided no creditor objects. Discharge applications can now be made online through the Insolvency Department’s e-Insolvensi portal, and the department aims to shorten the process further next year.
Azalina also said the parliamentary special select committee on separating the roles of the Attorney-General and the Public Prosecutor will meet again next week, after the Attorney-General’s Chambers provides its legal response.
This article is general information, not legal advice. For advice on your own situation, speak to a lawyer.