No, effective rate is 5.88 % p.a. Of course when you took 2 years as the tenure, the interest rate will be 5.88 % x 2. No compound interest and any hidden charges. How do I know, because I did took some loan to start off my share financing last year October and my repayment will be concluded in 2 months time.

I took a 10k loan, so I get 10k and every month I need to install 882.33.

Check count,

Meaning every month, I'm making a repayment of 833.33 principal + 49 interest portion = RM 882.33 installment per month

882.33 * 12 months = 10,588 (RM 10,000 principal + RM 588 interest portion).

And this is not the first time I've experience this way of financing, because this year I did advise some of my friends to cash advance from the dial a cash transfer to finance some of their business costs and capital. Tentatively, the rate is reasonable, hence I would say it is lower than personal loan (always 7-9 %). Please do not cash advance from ATM machines via credit card, as the rate is exorbitant, 18 % per annum and 5 % advance fee on the sum of withdrawal.

Interest financing is fine s long as you can finance them. So do not overlook it and always ask more of the details and do a check count before taking them. Cheers.

This post has been edited by andrewckj: Sep 20 2011, 11:39 AM