Chapter 14: Interview With The Banker from Bank Islam

 

Summary of the interview

Here is our banker’s information;

NAME	ENCIK FAIRUL IZZAR BIN ABDULLAH
POSITON	BRANCH MANAGER AT BANK ISLAM SDN.BHD (SHAH ALAM BRANCH)
JOB DESCRIPTION	1.      MANAGING BRANCH PERFORMANCE IN THE FINANCING DIVISION      2.      ENSURE ALL TRANSACTIONS OR ACTIVITIES FOLLOW THE GUIDELINES SET BY THE BANK

Q&A session summary:

Question 1: What is the meaning of personal loan?

Answer: In Bank Islam, personal loan is known as personal financing. Personal financing is used for a variety of purposes. It also used to settle bank debts in other banks. For example, credit card, personal loan or car loan. Bank Islam used profit rate and not interest rate that used by the other conventional banks. The profit rate of Bank Islam is the lowest rate in the market. The minimum personal financing that can be applied by the customers is RM 10 000 and maximum is RM 300 000.

 

Question 2: Who is eligible to apply for a personal financing?

Answer: Bank Islam provides 2 personal financing packages, namely private and government. This means, applicants working in the private sector and government employees can apply for personal financing. The requirement to apply for personal financing is that the salary must be a minimum of RM 2000 and above including basic and additional allowances, only then they are eligible to apply for personal financing.

 

Question 3: How much is the profit rate?

Answer: Bank Islam provide packages that have a 'special arrangement' with the customer's employer. This special arrangement is like, when a customer applies for personal financing, they will pay monthly installments through salary deduction or salary division. Through this condition, customers are eligible to get the lowest rate which is 2.30%.  The higher the profit rate, the higher the amounts of monthly installments to be paid.

 

Question 4: What is the difference between a ‘fixed rate’ and a ‘floating rate’?

Answer: Fixed rate means the monthly installments are fixed from the first year until the 10th year or the final year. While, the monthly installments of the floating rate can vary according to the current economy. These changes will follow the benchmarks set by the national bank. In today’s market, banks use floating rates because the monthly installments will be lower than the fixed rate.

The current floating rate is 2.52%. However, these rates can vary according to the instructions of the national bank. The decrease and increase of the floating rate set by the national bank is 0.25.

 

Question 5: What are the charges that will be imposed on the applicants?

Answer: The first charge is a group takaful plan. If the borrower suffers from a permanent disability (loss of ability to work) or death, the personal financing debt will be fully paid by the insurance company. Therefore, the debt burden will not go to the family. This charge is around RM 100 – RM 200. The second charge is the stamping charge. The rate of this charge is set by the LHDN. For example, each RM 1000 will be charged RM 5. In addition, a monthly installment advance payment of 2 months is also provided. For example, if the monthly installment is RM 200, the bank will take RM 400 from the loan amount that the applicant obtains. This means that, the applicant will start paying to the bank in the third month.  

We hope, this summary of the interview can help you understand and make the right decision when applying for personal financing offered by Bank Islam. Bank Islam 's personal loan scheme had been shared in Chapter 5 :D

For your information, we will combine the interview's video and other important info in a short video that will be upload in YouTube soon! So please wait for our video😁