Personal loans are being offered by most of the banks in Malaysia, as a support for those in financial need. Sometimes, personal loan is very useful in times of emergency, in which a large amount of money is required. Nowadays, the personal loans offer are part of the banks’ portfolio as products and services. More and more people are looking into personal loans as part of financial management and needs. Personal loans are different from home loans or car loans as personal loans’ amount do not require any specific reason for paying out to applicants. As long as it fits into the purpose of the applicant such as paying an urgent medical fees, clearing outstanding of a credit card or funding a child’s tertiary education, the money can be used.        

How it works ?

Bear in mind that personal loans come in many types of packages to cater the different needs of consumers. Some of the variations include different interest rates, payment methods or terms and the timeline for approval of the loan. A few aspects that most banks have come out with to attract more customers include maximum amount of loans offered, specific tenure as well as payment options or lower interest rates. Therefore, it is important for consumers who wish to apply for a personal loan to check out the offer by various banks.     

Interest Rates

In terms of personal loan interest rate, it is definitely higher as compared to loans offered from government sector, which come at a lower interest rate. Personal loan’s interest rate vary according to different type of loan scheme and the bank itself. In general, the estimated interest rate for personal loans offered in Malaysia is in between 3-12%. The interest rate is usually higher if the personal loan gives higher flexibility in respect to loan amount and tenure.

Collateral ?

As most of personal loans are considered as unsecured scheme, a guarantor or collateral is not part of the requirement to apply for the loan. Nevertheless, there are certain loan schemes offered by certain banks do request for guarantors prior to approval of the loan. Being a guarantor means to hold a big responsibility in case the one who borrow the loan fails to fulfill any requirement of the loan agreement. Therefore, it is strongly advised not to simply sign off as a guarantor for anyone.

In order to apply for a personal loan, few criteria have to be fulfilled. Even though the criteria might differ from bank to bank, there are some general criteria that remain similar. For example, it is a must for applicants to be a Malaysian citizen aged 21 years and above with a steady monthly income with the minimum of RM2000. This minimum requirement will differs. Thus, a proof of steady employment with a company that is listed under the bank’s approval list is part of the requirement.      

Most popular loans in Malaysia ?

One of the top personal loans in Malaysia is the Bank Rakyat Personal Loan. It is not a requirement to have any guarantor or collateral to get the personal loan, the interest rate ranges from 7.3% to 8.3% depending on the amount and tenure of the loan applied. On the other hand, CIMB Personal Loan offers customers with flexibility, reasonable interest rates and great customer service in terms of faster processing time, approvals and disbursals. RHB Personal Financing is considered as a recommended personal loan too. Its main selling points include the zero processing fees requirement without the need of a guarantor. The interest rate is in between 8.2% to 13.5% depending on the loan amount. Some other top personal loans are the Bank Islam Personal Loan, Maybank Personal Loan and BSN Personal Loan