# Monthly Flat Rate/Actual Annual Interest Rate Calculator

## Please enter the following Monthly Flat Rate Loan information

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

## What is a "Monthly Flat Rate/Actual Annual Interest Rate Calculator"?

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
Example:

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%

Please note that the monthly flat rate can be converted to the actual annual interest rate. When comparing loans, the annual interest rate should be used for comparison, and the lower actual annual interest rate, the better.

For convenience, a Loan Calculator has been provided on this website.

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:

• P0 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
In the first month, the principal you actually repaid is:

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 in Malaysia

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

List of banks in Malaysia

No. Bank Name Bank website
1 Affin Bank Berhad Affin Bank
2 Alliance Bank Malaysia Berhad Alliance Bank
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
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
18 Mizuho Bank (Malaysia) Berhad Mizuho Bank 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
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
Source: List of Onshore Banks in Malaysia - Bank Negara Malaysia

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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