Civil servants in Malaysia are spending more than half of their monthly salaries for repaying debts, a study by Negara Bank suggested.

According to the report, the central bank's financial stability review highlighted that civil servants debt risks and policy considerations is more apparent in those earning less than RM5,000 (S$1,650) monthly.

After considering their monthly expenditure on basic necessities and debt obligations, they are left with only 15 percent or about RM360 to RM586 to spend on discretionary items.

47 percent of the borrowings are for different consumption means like motor vehicles, personal financing, etc. This is more than the national average of 35 percent.

Personal financing has been one of the key contributors to debt accumulation by civil servants, which accounts for 34 percent of the total debt compared to the national level of 15 percent.

Among all the debts, housing debt is the most significant and accounts for 49 percent of civil servants' debts, suggests the report. 

"Based on anecdotal evidence, personal financing is commonly used to sustain the standard of living and lifestyle choices of borrowers and for small business use," the central bank article said.

The study has covered 1.26 million out of 1.6 million civil servants, which consists of comprising permanent federal government employees and police, showed that 97 percent of them had some form of borrowings.