"Monthly Flat Rate/Actual Annual Interest Rate Calculator" Supplementary Information

The "Monthly Flat Rate/Actual Annual Interest Rate Calculator" is used to convert the Monthly Flat Rate to the actual annual interest rate for comparison of different loans, without needing to use MS Excel (spreadsheet).

**Loans Calculated Using Monthly Flat Rate**

The formula for calculating loans using monthly flat rate is as follows:

- A is the monthly repayment amount
- P is the loan amount (how much money you borrowed)
- r is the monthly interest rate of the loan (%)
- n is the number of repayment months

I borrowed RM120,000 from the bank, if the monthly flat rate is 0.14%, to be repaid over 12 months, then my monthly instalment amount is:

For this example, borrower borrow loan with 0.14% monthly flat rate and 12 months repayment period, the actual annual interest rate is 3.09%

For convenience, a

So how can the monthly flat rate be converted to the actual annual interest rate?

First, we need to understand the loan calculation method using the annual interest rate. To facilitate calculation, I will define the following variables:

- P
_{0}is the total loan amount (how much money you borrowed) - R is the Annual Interest Rate
- r = R/12 is the monthly interest rate
- A is the monthly repayment amount
- n is the number of repayment months

Therefore, the outstanding principal for the first month is:

Rewriting this, we get:

From the above formula, similarly, we can write it as:

We need to find a way to eliminate the n + 1 term, try:

Substitute (3) into (2):

After rearranging:

Substitute (4) into (5):

So (7) can also be written as:

Represents the outstanding loan for n-th month, which means when it comes to the last month this value is 0. So (8) can also be written as:

After rearranging:

Finally, r can be calculated, then multiply r by 12 to get the actual annual interest rate for the monthly flat interest loan!

The calculation results from the "Monthly Flat Interest Rate/Effective Annual Interest Rate Calculator" are for reference only, loan details must be confirmed with the relevant bank or financial institution first!

The above calculation for converting monthly flat rate to actual annual interest rate is referenced from the following website:

https://mitchellt.com/math/2018/08/11/derivation-of-monthly-payment-formula.html

Credit score rating is very important when you borrow money, it is because if your credit score rating is too low, you may not be able to borrow money! For more information about credit score rating, please visit the below website:

Your Credit Score Rating - Plans & Tips

No. | Bank Name | Bank website |
---|---|---|

1 | Affin Bank Berhad | Affin Bank |

2 | Alliance Bank Malaysia Berhad | Alliance Bank |

3 | AmBank (M) Berhad | AmBank |

4 | BNP Paribas Malaysia Berhad | BNP Paribas Malaysia |

5 | Bangkok Bank Berhad | Bangkok Bank |

6 | Bank of America Malaysia Berhad | Bank of America Malaysia |

7 | Bank of China (Malaysia) Berhad | Bank of China Malaysia |

8 | Bank of Tokyo-Mitsubishi UFJ (Malaysia) Berhad | MUFG Bank Malaysia |

9 | CIMB Bank Berhad | CIMB Bank |

10 | Citibank Berhad | Citibank |

11 | Deutsche Bank (Malaysia) Berhad | Deutsche Bank Malaysia |

12 | HSBC Bank Malaysia Berhad | HSBC Malaysia |

13 | Hong Leong Bank Berhad | Hong Leong Bank |

14 | India International Bank (Malaysia) Berhad | India International Bank |

15 | Industrial and Commercial Bank of China (Malaysia) Berhad | ICBC Malaysia |

16 | J.P. Morgan Chase Bank Berhad | J.P. Morgan Malaysia |

17 | Malayan Banking Berhad | Maybank |

18 | Mizuho Bank (Malaysia) Berhad | Mizuho Bank Malaysia |

19 | National Bank of Abu Dhabi Malaysia Berhad | NBAD Malaysia |

20 | OCBC Bank (Malaysia) Berhad | OCBC Malaysia |

21 | Public Bank Berhad | Public Bank |

22 | RHB Bank Berhad | RHB Bank |

23 | Standard Chartered Bank Malaysia Berhad | Standard Chartered Malaysia |

24 | Sumitomo Mitsui Banking Corporation Malaysia Berhad | SMBC Malaysia |

25 | The Bank of Nova Scotia Berhad | Scotiabank Malaysia |

26 | The Royal Bank of Scotland Berhad | Royal Bank of Scotland |

27 | United Overseas Bank (Malaysia) Bhd. | UOB Malaysia |

28 | Affin Islamic Bank Berhad | Affin Islamic Bank |

29 | Al Rajhi Banking & Investment Corporation (Malaysia) Berhad | Al Rajhi Bank Malaysia |

30 | Alliance Islamic Bank Berhad | Alliance Islamic Bank |

31 | AmBank Islamic Berhad | AmBank Islamic |

32 | Asian Finance Bank Berhad | Asian Finance Bank |

33 | Bank Islam Malaysia Berhad | Bank Islam |

34 | Bank Muamalat Malaysia Berhad | Bank Muamalat |

35 | CIMB Islamic Bank Berhad | CIMB Islamic |

36 | HSBC Amanah Malaysia Berhad | HSBC Amanah |

37 | Hong Leong Islamic Bank Berhad | Hong Leong Islamic Bank |

38 | Kuwait Finance House (Malaysia) Berhad | Kuwait Finance House |

39 | Maybank Islamic Berhad | Maybank Islamic |

40 | OCBC Al-Amin Bank Berhad | OCBC Al-Amin Bank |

41 | Public Islamic Bank Berhad | Public Islamic Bank |

42 | RHB Islamic Bank Berhad | RHB Islamic Bank |

43 | Standard Chartered Saadiq Berhad | Standard Chartered Saadiq |

44 | Affin Hwang Investment Bank Berhad | Affin Hwang Investment Bank |

45 | Alliance Investment Bank Berhad | Alliance Investment Bank |

46 | AmInvestment Bank Berhad | AmInvestment Bank |

47 | CIMB Investment Bank Berhad | CIMB Investment Bank |

48 | Hong Leong Investment Bank Berhad | Hong Leong Investment Bank |

49 | KAF Investment Bank Berhad | KAF Investment Bank |

50 | Kenanga Investment Bank Berhad | Kenanga Investment Bank |

51 | MIMB Investment Bank Berhad | MIMB Investment Bank |

52 | Maybank Investment Bank Berhad | Maybank Investment Bank |

53 | Public Investment Bank Berhad | Public Investment Bank |

54 | RHB Investment Bank Berhad | RHB Investment Bank |

55 | Al Rajhi Banking & Investment Corporation | Al Rajhi Bank |

56 | Deutsche Bank Aktiengesellschaft | Deutsche Bank |

57 | PT Bank Muamalat Indonesia, Tbk | Bank Muamalat Indonesia |

This "Monthly Flat Rate/Actual Annual Interest Rate Calculator" allows you to easily convert the monthly flat rate to the actual annual interest rate for loan comparison. Please help to share if you find this "Monthly Flat Rate/Actual Annual Interest Rate Calculator" useful! Thank you!

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