Here’s What You Need to Know About Personal Loans in Malaysia

Here’s What You Need to Know About Personal Loans in Malaysia

We all have some personal goals we would like to accomplish. Whether you are going to celebrate big moments in your life, start a new chapter in your life, or check things off your bucket list, you will almost always need some kind of funding to get started. 

Personal financing can be the best option for pursuing your dreams, whether they include starting your own small business, going for higher studies, spending your vacation in a foreign country, or remodelling your home. With a personal loan, you can have instant money, which helps fund your short-term plans. You can apply for a personal loan online in Malaysia if you are a Malaysian citizen and meet other eligibility requirements.

Know what is a personal loan

Financial institutions, particularly banks, offer personal financing to meet your immediate financial needs. Ideally, you can get a personal loan online when you require additional funds to pay for your children’s educational expenses, home renovations, business expenses, travel, medical bills, or any other expenses. 

You have the freedom to use personal loans to your advantage and to meet your needs. They are unsecured loans that require no collateral or security. A personal loan from a bank is offered at an interest that ranges between 12-13 percent and at a flexible repayment schedule ranging from 1 to 10 years.

What are the features and benefits of a personal loan?

Some prime benefits of personal financing for banks include:

1. Quick processing and approval

You try saving money to meet financial emergencies like medical expenses or a child’s education expenses, but sometimes you will be short of funds. What will you do when you need quick funds during such situations? You will look for an instant personal loan. Fast-approval loans are a good option to meet your urgent financial needs as they are processed and disbursed within a day or a maximum of two days based on the applicant’s eligibility and submission of documents.

For instance, RHB offers a personal loan of a minimum of RM2000 and a maximum of RM150,000 to self-employed, salaried, and commission-earning individuals who are between 21 and 55 years of age. You will become eligible if you earn at least RM1500 per month. All they need is a copy of NRIC, the latest EPF statement, and the current salary slip.

2. No collateral required

Personal financing is of unsecured nature and hence, there is no collateral involved. In a way, you don’t have any risk of losing your valuable property or asset.

3. Competitive interest

There are some personal loans offered at competitive interest rates. For instance, a government servant or an employee working in a government-linked company (GLC) can apply for a fast-approval personal financing of up to RM200,000 at low interest and a repayment period of up to 10 years. 

It is definitely worth your time to see if the company you work for is a GLC in Malaysia. You can find reputed banks offering personal financing to a government employee or civil servant as it is specifically intended for government employees. Monthly repayments are automatically deducted from salary through Biro Angkasa. Further, these personal loans are offered at below-market interest rates to civil servants and government employees whose monthly gross income is RM 1000 or more. 

For instance, RHB offers Personal Financing – i for the civil sector and Personal Financing – i for pensioners, which are of this nature. 

4. Low monthly instalments

You can find personal loans offered at a low or affordable monthly repayment plan.

5. Flexible repayment schedule

With personal financing from reputed banks, you can work out a flexible repayment schedule, ranging from one year to seven years. When it comes to government employees, the tenure is up to ten years. 

6. Easy repayment methods

Monthly repayments of personal loans are made easy through auto-debit from your savings account or via self-payment. 

How to apply for a personal loan online?

You need to go through the steps explained to apply for a personal loan online.

Step 1: Determine the loan amount

Your income and the expense you are trying to cover should be the basis for how much money you borrow. To avoid overextending yourself, it is advisable to find the amount you can spend each month and borrow no more than that amount. A loan that is too big will force you to pay interest on a sum that is greater than is necessary. That calls for determining the amount of debt you can manage and the cost of your purchase before applying for a loan.

With the personal loan calculator, you can find out the amount you can borrow based on your salary, the loan amount you want to apply for, and the type of personal financing. The online calculator helps you know the monthly repayments for a certain loan amount to check your affordability.

Step 2: Check your credit score

The amount of credit you are eligible for will depend on your credit. Before offering an unsecured loan, the majority of lenders demand strong credit ratings and lengthy history.

Step 3: Choose the right product

You need to go through the different personal loan products, interest rates, tenure, and monthly repayment amounts before applying for a loan.

Step 4: Submit your application 

Fill out the application form and submit it with the necessary documents online for processing and approval.

To conclude, personal financing in Malaysia will get you quick money to cover any emergency expenses. However, to borrow money and repay it with ease, it is crucial to plan your finances.