The Best Personal Loans In Malaysia For 2016
Let’s face it – nobody really fancies the idea of borrowing money, but sometimes life situations might leave you with no other choice.
Whether it is paying for that much-needed home improvement project, major repair for your car, sudden medical bills or other unexpected emergencies, a personal loan can come in handy when you are in need of that extra money. These days, you can even apply online for a personal loan.
However, borrowing should never be done on a whim, and must be budgeted for and carefully planned beforehand, so you know how you will manage the repayments.
This is our personal loan guide, with all the latest updates in 2016, to provide insight on which is the best loan for your situation before you apply.
1. Personal loan with the fastest approval
Sometimes life takes you by surprise, and that surprise could be in the form of a financial emergency. If you are stuck in similar situation, there are personal loans available with fast approval, so you don’t have to worry about coming up with the money for any sudden emergencies. The best personal loan with the fastest approval duration is:
Interest rate (p.a.): 8.18% – 14.52%
Loan amount: RM2,000 – RM150,000
Loan tenure: 1 – 5 years
Approval duration: 10 minutes approval and disbursement at Easy Branch
Min. income requirement: RM1,500/month
Age requirement: 21 – 55
Why it’s the winner: The application process does not get shorter or simpler. Also, with a salary requirement of just RM1,500, it is attainable even for fresh graduates who might require urgent financial assistance.
However, you do need to be a citizen of Malaysia to qualify for this loan.
Drawbacks: It comes with one of the higher interest rates in the personal loan market. Also, a one-time 0.5% stamp duty fee is applicable when you apply for the loan.
You will also need to pay a penalty of RM200 for early settlement within the first six months from the date of loan approvals, so you will not be able to shake off interest even if you settle your debt early.
Conversely, for late payment charges will be 1% on outstanding loan amount. You also need a linked account.
2. Personal loan with lowest interest rates
If time is on your side, you should look for the personal loan with the lowest interest rates. A lower interest rate means lower cost of borrowing. For example, a personal loan with an interest rate of 7.00% only costs RM6,288 over three years for a RM30,000 loan, while a loan at 12.00% costs RM10,788 over the same period.
We’ve combed the market and found the personal loan with the lowest interest rate:
Interest rate (p.a.): 6% – 7%
Loan amount: RM10,000 – RM150,000
Loan tenure: 1 – 10 years
Approval duration: Up to 5 business days
Minimum income requirement: RM3,500
Age requirement: 18 – 60
Why it’s the winner: It offers one of the lowest interest rates in the market. It also offers a maximum loan tenure of 10 years, which will give you ample time to work out a financial strategy to service your loan instalments.
Drawbacks: Don’t bank on it for a quick buck, though, for it takes up to five days to process your loan application.
It also comes with a pretty high salary requirement of RM3,500 a month compared to other loan services offered in the market.
Late payment charges are 1% of your outstanding loan amount.
3. Personal loan with the lowest income requirement
Most banks prefer to offer loans to higher income earners or those with better credit health. But what about those from the lower income ranges who are in need of a personal loan to pay for their emergencies or start a small business?
Fortunately, there are banks who look out for the little guys and offer loans to individuals with low or moderate income.
Interest rate (p.a.): 6.17% – 6.62%
Loan amount: Maximum RM200,000 for Government servants; Maximum RM100,000 for GLC staff
Loan tenure: Maximum 10 years
Approval duration: Up to 5 working days.
Min. income requirement: RM1,000 for Government servants; RM2,000 for GLC staff
Age requirement: 18 – 60 or up to retirement age (whichever is earlier) for Government servants; 21 – 60 or up to retirement age (whichever is earlier) for GLC staff
Eligibility: Government servants with at least 3 months of completed service, or Government-linked company (GLC) staff who are confirmed with 3 years in service.
Why it’s the winner: The Agrobank AgroCash-i provides consumer financing especially for agriculture and agro-based activities. The implementation of this product is based on the Tawarruq transactions, which allows clients to raise money quickly and easily.
The highlight of this product is, it doesn’t just offer one of the lowest interest rates in the market, it also offers a maximum loan tenure of up to ten years. This means lower monthly repayment as you can spread your repayment over a longer loan tenure.
Also, with a low income requirement at just RM1,000, this package is the perfect lifesaver for those who require financing assistance.
Drawbacks: AgroCash-i has one of the longest approval processes of up to 5 days, so this is definitely not the best option if you need the money urgently.
You also need to be employed by the Government or a GLC to be eligible for this loan. Contract Government staff will require a guarantor or guarantors from a permanent Government employee.
Finally, you will need to pay RM50 for each tawarruq transaction. This is subject to 6% GST.[sc:sample_banner]
4. Personal loan with the longest loan tenure
A longer loan repayment period means a smaller monthly payment. This is best suited for those who are looking to borrow a lot of money but are only able to pay it back in small amounts every month.
However, since July 2013, Bank Negara Malaysia has enforced the maximum loan term of 10 years for personal loans, so a 10-year loan repayment tenure is as good as it gets for this category.
Interest rate: From 6.16%
Loan amount: Up to RM150,000
Loan tenure: 1 – 10 years
Approval duration: Up to 5 working days
Minimum income requirement: From RM1,000 (depending on package)
Age requirement: 18 – 60 (at the end of financing tenure)
Why it’s the winner: It offers a high amount of financing of up to RM150,000 despite its low income requirements. This is also one of the few packages in the market that offers the longest loan repayment tenure of up to 10 years, which is the maximum tenure for personal loan set by Bank Negara Malaysia (BNM).
Despite this, it does not require a guarantor or any advance payments. For default repayments, borrowers will be charged 1% per annum on the outstanding amount of the monthly payment during the financing tenure.
Drawbacks: The long approval duration could be a hassle for those who are in urgent need of financial help.
You will also be required to fork out 0.5% of total financing for stamp duty.
5. Personal loan with the highest loan amount
No matter how financially prepared you think you are, life has a way of throwing curve balls that you never expect.
Unexpected expenses also tend to crop up when you least expect it. For example, a family member could suddenly fall sick and require immediate and very expensive treatment.
When faced with a financial emergency, you don’t just want to get a loan that will pay you fast, you also want a loan that will give you a sufficient amount to weather the storm. MAC I.O.U Personal Loans combine the two to offer you the help you need in dire times.
Interest rate: 7% – 13.5% / The effective lending rate ranges from 12.38% to 24.82% depending on the tenure of the Facility.
Loan amount: RM5,000 to RM250,000
Loan tenure: 1 – 5 years
Approval duration: Within 60 minutes
Minimum income requirement: RM3,000 a month
Age requirement: 21 – 60
Why it’s the winner: All you need is your MyKad and EPF statement to get started on application, and you will not require a guarantor or collaterals.
But what makes it a real winner is that it offers 20% cashback rewards when you make your repayments on time. This will allow borrowers to enjoy lower monthly instalments as your interest charges are reduced.
Also, there are no penalties for early settlements.
Drawbacks: There’s really not much to gripe about the Mach I.O.U loan, as far as lending facilities go, other than the fact that it comes with a slightly higher income requirement at RM3,000.
However, if you are looking to get a high loan amount, Mach only allows up to 5 years tenure, which means higher monthly repayment. That’s RM3,375 a month for a RM150,000 loan, compared to RM2,125 a month over 10 years (7.00% p.a.).
Similar to most other personal loans, you will also be required to pay a stamp duty of 0.5% of loan amount, and late payment charges are at 1% of the outstanding loan amount.
If you are scouting for a personal loan, do remember that interest rate comparison is only one of the factors that you need to look out for. Other factors you should consider include loan tenure, approval duration, penalty charges, as well as benefits you could derive from it.
Getting a personal loan isn’t hard, but it is your responsibility to ensure that you can repay it in a timely manner to avoid landing in a financial quagmire. Check out our personal loan calculator for an idea on where to start!
The good news is, amid these uncertain economic times, we can expect to see more competitive personal loan packages in 2016.