3 December 2025

Following the recent industry-wide announcement, banks will offer goodwill discount at the point of early settlement for existing fixed-rate hire-purchase agreements and/or any agreement that applies the Rule of 78 method. 

Please find the key points as follows:

• Effective date: The goodwill discount programme will commence starting from the effective date of the Hire-Purchase Amendment Act (“HPAA”), which is expected in the first quarter of 2026.

• Duration: The programme will remain available until all fixed rate hire-purchase agreements under Rule of 78 method have reached maturity or settled early (estimated 9 years, in line with the maximum vehicle financing tenure).

• What you need to do: Customers who wish to settle their hire-purchase financing early will be provided with comprehensive details upon application for early settlement.

Customers who wish to continue making payments according to their agreed schedule until the end of the tenure will not be affected by the Rule of 78 method. As such, customers may continue to pay the same instalments as originally agreed and do not need to take any action.

To read more, please refer to:

(a) CIMB Website: You may search “FAQ on Goodwill Discount” to access related FAQs.

(b) The Association of Banks in Malaysia (ABM)’s Press Release:

Click here for more info

(c) Association of Islamic Banking and Financial Institutions Malaysia (AIBIM)’s Press Release:

Click here for more info