Credit Score Check in Malaysia: What Employers Need to Know

When hiring for roles that involve handling money, budgets, or sensitive financial data, employers in Malaysia sometimes consider conducting a credit score check on potential hires.

While this is more common in financial institutions, it can also apply to companies where financial responsibility is a key part of the job.

We will share with you on how credit score checks work, their legality, and when they are appropriate to help employers make informed and ethical hiring decisions.

What Is a Credit Score?

A credit score is a three-digit number that represents a person’s financial reliability. In Malaysia, this score typically ranges from 300 to 850, with higher numbers indicating stronger credit management.

Credit scores are compiled by authorised reporting agencies such as CTOS, Experian Malaysia, and CCRIS (Central Credit Reference Information System). These scores help banks and lenders assess risk when approving loans or credit cards. It also provides an additional layer of insight for roles that require high levels of financial trust for employers.

What Is a Credit Score Check?

A credit score check is the process of reviewing an individual’s credit history and score through official credit reporting agencies. It provides a summary of their borrowing and repayment behaviour, including outstanding loans, late payments, bankruptcies, and legal actions.

Credit reports show details like credit accounts, payment history, and any court judgments. However, sensitive information like salary, health, or marital status is not included in these reports.

Can Employers Conduct a Credit Score Check in Malaysia?

Yes. It is legal, but with conditions. Employers can only conduct a credit score check with the written consent of the candidate, in line with the Personal Data Protection Act (PDPA).

Credit checks are most common when hiring for roles that involve managing company funds, budgets, or financial data, such as finance managers, accountants, treasurers, or procurement officers. The check helps employers assess a candidate’s financial responsibility and potential risk in sensitive positions.

What Roles or Job Positions That Need to Check Credit Score?

As mentioned above, credit score checks are not necessary for every role, but they are valuable for positions where employees handle company money, manage budgets, or access sensitive financial information.

It includes:

Finance and accounting roles, such as accountants, finance managers, and treasurers who oversee company funds.
Procurement and purchasing positions that manage large vendor transactions or negotiate contracts.
Senior management and executive roles, like CFOs, COOs, or directors, who make high-value financial decisions.
Banking and financial services positions, including credit analysts, loan officers, and compliance officers.
Cash-handling roles in retail or operations where employees directly manage transactions or petty cash.

When Should You Conduct a Credit Score Check?

Credit score checks are typically performed:

During pre-employment screening for finance-sensitive positions.
When considering internal promotions to roles that handle budgets or financial controls.
When evaluating vendors or contractors for partnerships involving large transactions.

This step is not needed for most roles but can be a safeguard for positions with financial decision-making power.

How to Check Your Credit Score in Malaysia

To conduct a credit score check, employers must follow these steps:

Obtain written consent from the candidate or vendor.
Request the report from authorised credit reporting agencies:
- CTOS (Malaysia’s largest private credit reporting agency)
- Experian Malaysia (formerly RAM Credit Information)
- CCRIS via Bank Negara Malaysia or MyCreditInfo
Review the credit report for red flags such as late payments, bankruptcy records, or excessive debt.

Some banks, like CIMB, also provide credit score access and improvement tips for individuals, but employers should rely on official reporting agencies for accuracy.

What Information Appears in a Credit Report?

A typical Malaysian credit report may include:

Outstanding loans (housing, car, personal)
Credit card utilisation and payment history
Legal actions or court judgments
Bankruptcy status or past bankruptcies
Business interests or directorships (if any)

It will not show personal details like savings, employment history, salary, religion, or criminal records.

Why Employers Might Use Credit Checks

Employers use credit score checks mainly to gauge financial responsibility, especially when hiring for positions with access to funds or confidential financial data. A strong credit history suggests reliability, while significant red flags might indicate higher risk of fraud or mismanagement.

This step is part of a broader risk management strategy rather than a standalone hiring decision.

What Employers Should Be Cautious About

While credit score checks can be useful, employers must approach them carefully:

Always get explicit consent before conducting the check.
Use the information only when it is relevant to the role, not as a blanket hiring filter.
Avoid discriminatory practices; a poor credit score should not automatically disqualify someone unless it directly impacts the role’s responsibilities.
Keep credit data confidential and handle it securely, in compliance with PDPA.

Alternatives to Credit Score Checks

If a credit check feels unnecessary, employers can consider alternatives like reference checks, employment background verification, or financial responsibility assessments. They provide insight into a candidate’s reliability without reviewing personal financial data.

FAQs

Do I need candidate consent to check their credit score?

Yes, under PDPA, written consent is mandatory before accessing someone’s credit report.

Which credit reporting agencies can employers use in Malaysia?

The main agencies are CTOS, Experian Malaysia, and CCRIS (Bank Negara).

Will a credit check affect a candidate’s credit score?

No. Employment-related credit checks are soft inquiries and do not lower the score.

Can I reject a candidate solely based on their credit score?

You may, but it’s best to document the rationale and use it as one factor among many to avoid discrimination claims.

Are credit checks required for all positions?

No. They are most relevant for roles involving finance, procurement, or company funds.

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