Rules and Terms of financing

 

 

Items	Details
Finance limit	minimum: RM 30 000 Maximum: RM 10.0 million
Profit rate	taxi and car-hire: Maximum of 5 years or the remaining lifespan of taxi/ car-hire, whichever is shorter Bus: maximum of 10 years except for express buses 8 years or the remaining lifespan of the bus, whichever is shorter. Note: The maximum duration for financing should not be more than the vehicle lifespan as set by LPKP to prevent from having to change the vehicle when financing has not yet ended. For example, the lifespan of a taxi is not more than 7 years, express bus not more than 10 years, stage bus not more than 15 years and school bus not more than 20 years.
Issues	Item
Financing purposes	Purchase of new or reconditioned/ used vehicles for new licence or STK or replacement or old vehicles. Improvement of quality of vehicles (such as changing to NGV, installation/ change of audio/ video, seats, air-conditioning, body paint and other modifications) Financing for revolving capital is only allowed for bus and taxi operators with the status of company/ firm/ cooperative (individual operators are not allowed) Refinancing of an existing loan is not allowed. Note: Purchases of reconditioned/ used vehicles but comply with the rules under the LPKP Act 1987.
Issues	Item
Type of finance	Ijarah and Ijaarh Thummalbai’ (ITB) Bai Bithaman Ajil (BBA)/ Periodic instalment Industry Hire & Purchase (IHP)/ Hire & Purchase (HP) Leasing
Profit rate	The charged profit rate is 4.0% annually based on the annual balance (annuity) This rate is equal to the average  of 2.5% annually for 5 years
Finance margin	Up to 100% of vehicle price and repair cost depending on the financing instrument which has been offered as well as the project risk of credit