Answer first

In a quotation that explicitly uses the legacy flat method, the rate is calculated against original principal for every year. Current reducing-balance facilities require different inputs.

How to decide

For a legacy flat-rate document, first reproduce its flat-interest schedule. Then calculate an effective rate from the amount actually received and the dates and amounts of all payments; do not double a flat rate as a shortcut.

A practical process

Confirm the method in each current provider disclosure. When comparing quotations, keep vehicle price, deposit, term and included charges identical and use a reviewed cash-flow solver.

Limits and next step

Maybank states that it adopted reducing-balance hire purchase from 1 August 2026. No current provider effective-rate comparison is published here. Check the linked primary source and its captured date before making a commitment.

Malaysian worked example

Show the working

Inputs

  • legacy RM72,000 quotation
  • 3% flat
  • 7 years

Calculation

  1. legacy flat interest = RM15,120
  2. monthly = RM87,120 ÷ 84 = RM1,037.14

Illustrative resultThe legacy schedule totals RM87,120 before other charges.

Maybank states that it adopted reducing-balance hire purchase from 1 August 2026. No current provider effective-rate comparison is published here.

Sources

Update required means this source has passed its internal freshness window. Product-specific commercial claims remain suppressed until the source is checked again.