Debt Consolidation Calculator Malaysia: Compare Loans & Reduce Your Monthly Repayment

A debt consolidation loan in Malaysia is a single personal loan used to pay off multiple existing debts – such as credit cards, personal loans, or hire purchase arrears – combining them into one lower monthly repayment. It simplifies debt management and can reduce the total interest paid if the new loan carries a lower effective interest rate than the combined existing debts.

The iMoney debt consolidation calculator lets you enter your existing loan balances, interest rates, and remaining tenures alongside a proposed new consolidated loan amount and rate. It then compares your current total monthly repayment against the projected new repayment, showing your potential monthly savings and total interest reduction.

No. AKPK (Agensi Kaunseling dan Pengurusan Kredit) is a Bank Negara Malaysia-regulated debt counselling agency that restructures your existing debts with your existing banks under a Debt Management Programme (DMP), at no new loan cost. Debt consolidation is a new loan taken from a bank to pay off existing debts. AKPK is typically recommended for borrowers who cannot qualify for a new loan.

An overlap loan is a Malaysian banking term for a personal loan used specifically to consolidate or pay off existing loan obligations. The term is commonly used by civil servant lenders (such as Bank Rakyat and MBSB Bank) to describe a refinancing facility that settles multiple outstanding loans and issues a new consolidated loan with a single monthly deduction.

Applying for a debt consolidation loan will result in a credit inquiry that is recorded in CCRIS. However, successfully consolidating and closing multiple accounts can improve your debt-to-income ratio over time, which positively affects future credit assessments. Missed repayments on the new consolidated loan will be recorded negatively in CCRIS, so maintaining consistent repayments is critical.

Most Malaysian banks cap personal loans – including those used for debt consolidation – at RM200,000 or 10 times monthly gross salary, whichever is lower. Under the Consumer Credit Act 2025 (CCA 2025), lenders must also ensure the total debt service ratio (DSR) does not exceed 60% of the borrower’s net monthly income after consolidation, as per BNM’s responsible lending guidelines.

Yes. A personal loan for debt consolidation in Malaysia can be used to settle outstanding credit card balances. Personal loans typically carry a lower effective interest rate (from around 5% to 15% p.a.) compared to credit card revolving credit (18% p.a.). Closing the credit card account after settlement is recommended to prevent re-accumulation of debt.

Yes. Several Malaysian Islamic banks offer Syariah-compliant debt consolidation financing under contracts such as Tawarruq or Murabahah. Bank Rakyat, Bank Islam, and MBSB Bank offer Islamic personal financing-i products that can be used for debt consolidation, with profit rates instead of interest rates and no compounding on outstanding balances.

To qualify for a debt consolidation loan in Malaysia, you generally need a minimum monthly income of RM2,000 (varies by bank), a DSR below 60% after the new loan is factored in, no active bankruptcies or legal actions, and a satisfactory CCRIS and CTOS credit profile. Civil servants may access dedicated overlap loan programmes through Bank Rakyat or MBSB Bank.

Costs associated with a debt consolidation personal loan in Malaysia may include a processing or disbursement fee (typically 1% to 2% of the loan amount), stamp duty on the loan agreement (0.5% of the principal), and early settlement fees on existing loans being closed. Some lenders, particularly for Islamic financing, may also charge a ta’widh (compensation) fee on late payment.