Kuala Lumpur, April 28 – Alliance Bank Malaysia Berhad and Alliance Islamic Bank Berhad launched the Alliance One Account, the first loan consolidation service of its kind in Malaysia that uses a mortgage product.
The Alliance One Account gives Malaysians greater control and flexibility over their monthly loan repayments as it is structured according to their preference and financial needs. It offers a choice of lower monthly repayments, savings on total interest/financing costs, and/or more cash in hand for personal consumption.
“With the higher cost of living putting pressure on everyone’s budget, we know that it will be increasingly challenging for Malaysians to pursue their desired standard of living,” said Suparman Kusuma, executive vice president, Head of Group Consumer Banking.
With the Alliance One Account, Malaysians will now have a choice to reduce their monthly loans repayment and interest paid on their loans so that they have more cash in hand for their daily expenditure. It is customised based on customer’s income and property value. Customers can choose to consolidate their hire purchase loans, personal loans, credit card balances, and/or overdraft credit limit balances into the Alliance One Account. This is structured as a mortgage account that is part term loan and/or overdraft.
“When we carried out our market research last year on how we can deliver fast, simple and responsive solutions to our customers, 88% of the respondents were interested to consolidate their loans, giving them convenience, control and flexibility over their monthly financial obligations,” said Kusuma.
One of the attractive features of this service innovation is the overdraft facility that comes with it. Subject to the Bank’s annual review, the overdraft facility is valid until the age of 60. This eliminates the need to refinance in the future, and enables customers to save on legal or documentation fees. With the Alliance One Account, customers only need to pay minimally interest on the utilised overdraft amount every month, or opt for the flexibility of making advanced payments and future withdrawals up to the Overdraft limit.
“Malaysia has one of the highest household debts in the region. The bulk of these debts centres around four types of loans: housing, car, credit cards and personal loans,” said Kusuma. “There are indicators that household debt will continue to be high due to internal and external headwinds. We believe that by having more cash and lowering interest costs will help them meet their needs more easily.”
Joel Kornreich, Group Chief Executive Officer of Alliance Bank said, “Alliance Bank is embarking on a transformation to bring to market innovations that are fast, simple and responsive, and in our customers’ best interest. The Alliance One Account is part of that commitment and we believe that it will be well-received by customers as it is relevant and meaningful to them.”