Which Personal Loan Best Fits Your Needs And Finances?

Which Personal Loan Best Fits Your Needs And Finances?

Sticking to your financial resolutions, such as saving up for home renovations or starting a business, is a challenge if you’re continuously cash-strapped.

However, there are alternatives such as taking out a personal loan to help you push past your goals. It may sound scary, considering personal financing made up 14.9% of the country’s total household debts in the last quarter of 2016, but if you pick a loan that caters to your needs and repayment ability, it could cushion the pain of your monetary struggles.

Thus, we’ve put together a list of personal loans best suited to meet your aspirations.

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1. Best personal loan for business expansion

Did you know that on average, 4 out of 5 of the top tech startups in South-East Asia are actually started by Malaysians or a Malaysian-listed company? More and more Malaysians are diving into the world of entrepreneurship and developing their own business.

In the case that you can’t secure a grant or an investor, a personal loan like the Alliance Bank CashFirst Personal Loan can be the next best solution.

Alliance Bank CashFirst Personal Loan
Interest rate4.99% - 14.78%
Loan amountRM5,000 – RM150,000
Loan tenure1 – 7 years
Approval duration2 days
Minimum income requirementRM3,000 a month or RM36,000 per annum
Age requirement21 – 60

Strengths: You are allowed to borrow up to eight times the amount of your fixed monthly gross income. It’s also one of the few personal loans that allows self-employed individuals to apply.

Drawbacks: If you’re self-employed, you need to have been in the business for more than two years in order to apply. Interest rates could also skyrocket to as high as 14.78%, depending on your credit profile and loan tenure.

Alliance Bank CashFirst Personal Loan

Alliance Bank CashFirst Personal Loan

Interest rates start at 4.99% p.a.

Get financing of up to RM150,000!

2. Best personal loan for housing renovations

If you have made a home purchase or have an old home you would like to spruce up, personal financing can help with funding the contractor or other home maintenance work.

Renovating your home can also increase your property’s worth, which is beneficial if you are opting to sell it off within a few years.

Hence, pick a personal financing plan, such as Al Rajhi Bank Personal Financing-i, that won’t strain your budget in the long-term by opting for a longer tenure and a low profit rate so that it’s less costly.

Furthermore, the repayment amount will be less if your financing tenure is longer, which is why this plan is the best to furnish your home.

Al Rajhi Bank Personal Financing-i
Profit rate4.99% - 10.50% per annum
Loan amountRM10,000 - RM150,000
Loan tenure2 – 8 years
Approval duration2 days
Minimum income requirementRM4,500 a month, but subject to a minimum annual income of RM60,000
Age requirementAbove 25
Strengths: You can enjoy a profit rate of 4.99% and up to 8 years loan tenure. Furthermore, financing amount is up to eight times of your salary, which means if you are earning RM5,000, you can get up to RM40,000 for housing renovations.

Drawbacks: You must earn at least RM60,000 a year to qualify for the plan and be a fixed income earner. Also, if you have a bad credit reputation, you must settle all overdue payments before applying as there are no exceptions for applicants with a bad credit record.

Al Rajhi Bank Personal Financing-i

Al Rajhi Bank Personal Financing-i

Interest rates start at 4.99% p.a.

Flexible tenure of 2 - 8 years

3. Best personal loan for debt consolidation

Reports revealed the younger generation, aged between 25 and 44, were the biggest group classified as bankrupt due to high debt commitments. Among the highest debt commitments were car loans (26.63%), personal loans (25.48%), housing loans (16.87%) and business loans (10.24%).

If you are among those with multiple obligations, you can ease your burdens by consolidating your debts. Your best bet would be a personal financing plan. For this category, we also chose the Alliance Bank CashFirst Personal Loan.

Strengths: When you’re paying off multiple debts, you’ll want to consolidate them under lower interest rates, so you can reduce your interest payments. The Alliance Bank CashFirst Personal Loan has relatively low interest rates that start from 4.99%. Its minimum income requirement of RM3,000 is also lower than some personal loans.

Drawbacks: Consolidating your debts under this loan may only be worth it if you are eligible for the best interest rates. Otherwise, interest rates can go up to14.78%.

Alliance Bank CashFirst Personal Loan

Alliance Bank CashFirst Personal Loan

Interest rates start at 4.99% p.a.

Get financing of up to RM150,000!

4. Best personal loan for financial emergencies

Sometimes unfortunate events can drain the life out of your bank account, which is why personal loans are your best bet in the event of an emergency, such as an urgent medical procedure.

If you don’t have the facilities to meet the high cost of your emergency, such as not having insurance, a personal loan with a fast approval rate can provide the cash you so badly need without the usual lengthy process. RHB Easy Pinjaman Ekspres is great for this.

RHB Easy Pinjaman Ekspres
Interest rate8.18% - 13.45% per annum
Loan amountRM2,000 - RM150,000
Loan tenure1 – 7 years
Approval duration24 hours
Minimum income requirementRM1,500 a month
Age requirement21 - 55
Strengths: You can get approved within 24 hours. The maximum borrowing amount is RM150,000 and the income requirement is as low as RM1,500.

Drawbacks:  You must open a linked bank account and those with a bad credit record must settle their overdue payments to qualify. The interest rate could also go up to 13.45% per annum and there will also be a 1% late penalty fee on your outstanding amount.

RHB Easy Pinjaman Ekspres

RHB Easy Pinjaman Ekspres

Fast approval within 24 hours

Minimum income requirement of RM1,500 a month

5. Best personal loan for government servants

As a government servant, you could qualify for personal loans that offer you lower interest rates and waived fees, such as Co-op Bank Pertama’s Personal Financing-i Lestari.

To qualify for lower interest rates, you’ll need to be a full-time civil servant who has served at least three months, or if you are a contract worker of not less than two years serving with the Jabatan Perpaduan Negara or the Jabatan Kemajuan Masyarakat. You can also apply if you are an employee of a government subsidiary or a government-linked company.

CBP Personal Financing-i Lestari
Profit rateGovernment servant: 4.15% - 4.75% per annum
Non-government servant: 6.00% - 7.00% per annum
Loan amountUp to RM200,000
Loan tenure1 – 10 years
Approval duration24 hours
Minimum income requirementRM3,000 a month
Age requirement18 – 58
Strengths: Civil servants can qualify for low profit rates of 4.15% – 4.75%. Your processing fees will also be waived.

Drawbacks: If you work in the private sector, you cannot qualify for the best rates. Besides that, you will incur higher interest rates the lower your salary range is. You will also have to pay a 0.5% processing fee.

CBP Personal Financing-i Lestari

CBP Personal Financing-i Lestari

Profit rates starting at 4.15% for civil servants

Civil servants enjoy waived processing fees

Apply for your personal loan online

If you are considering applying for a personal loan, you can avoid the inconvenience of visiting the bank branch and send in your application online instead.

Additionally, you can also further compare loans with our comparison table and leave your details so that our consultants can assist you with your loan application.

However, before you make the leap, here are three things you should consider before you hand over your documents.

  • A good credit report– as we’ve mentioned in some of the drawbacks, some personal loans make no exceptions for those with overdue payments or a bad debt repayment record. It is advisable that you settle any overdue payments and stabilise your credit report before you send in your application.
  • Make sure you have the means to sustain a loan– to avoid any extra charges, check your financial health and make sure you can sustain the loan itself. If you are planning to take a personal loan, set out a monthly budget and calculate within your means to ensure you have enough cash at the end of the month to pay the loan. Furthermore, some loans will impose a late payment fee if you do not pay on time.
  • Speak to consultants – avoid applying on impulse and consult a professional regarding personal loans if you are still not sure of it. You must understand the decision you are making, which you can easily do by getting free advice from our experts via our personal loan page.

Remember: before taking up a personal loan, do your research to understand what you’re getting yourself into. Make sure it’s something you need, and that you can afford the monthly repayments.

This article was first published in 2018 and has been updated for freshness, accuracy and comprehensiveness.

From now until October 31, 2020, apply for a personal loan, broadband plan or credit card to stand a chance to win RM13,000 worth of Corvan smart home prizes – because #udeservebetter. Find out more here.

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