Executive Summary: What Are the Rates Today?

The Snapshot: Interest rates for excavator financing in 2026 have stabilized.

New Excavators: 3.5% - 4.5% p.a. (Flat Rate).
Used Excavators (< 5 Years): 4.5% - 5.5% p.a.
Older Excavators (> 10 Years): 6.0% - 7.5% p.a.

Key Driver: Bank Negara Malaysia’s OPR remains steady, but banks are tightening credit for older diesel machinery due to ESG pressures.

Verdict: To get the lowest rate, buy a newer model (Tier 3 engine or above) and maintain a healthy bank balance for 6 months prior to application.

1. New vs. Used Excavator Rates

The age of the machine is the biggest factor in your interest rate.

Machine Age	Interest Rate Range (Flat p.a.)	Max Tenure	Margin of Finance
Brand New (0 Years)	3.50% - 4.25%	5 - 7 Years	Up to 90%
Reconditioned (Unregistered)	4.00% - 5.00%	5 Years	Up to 90%
Used (1 - 5 Years)	4.50% - 5.50%	4 - 5 Years	Up to 85%
Used (6 - 10 Years)	5.50% - 6.50%	3 - 4 Years	Up to 80%
Old Iron (11 - 20 Years)	6.50% - 8.00%	2 - 3 Years	Up to 70%

Ing Heng Difference: Most banks stop financing at Year 7. We finance up to Year 20.

2. Bank Rates vs. Credit Company Rates

Who offers the better deal?

Commercial Banks (Maybank, Public Bank)

Rate: 3.5% - 4.5%
Speed: Slow (3-5 weeks)
Strictness: Very High. Need audited accounts.
Best For: Large construction firms buying new fleets.

Credit Companies (Ing Heng, Pac Lease)

Rate: 4.5% - 7.0%
Speed: Fast (2-3 days)
Flexibility: High. Accept bank statements only.
Best For: SMEs, Sub-contractors, Urgent replacements.

3. How to Calculate Your Monthly Installment

The formula for Flat Rate interest is simple: (Loan Amount x Interest Rate x Years) + Loan Amount / Total Months

Example:

Loan: RM 200,000
Rate: 5%
Tenure: 5 Years
Total Interest = RM 200,000 x 5% x 5 = RM 50,000
Total Payable = RM 250,000
Monthly Installment = RM 4,166

4. Hidden Factors That Affect Your Rate

Down Payment: Paying 30% deposit can lower your rate by 0.5%.
Brand Value: Kobelco, Hitachi, and Cat get better rates than Sany or XCMG because their resale value is higher.
Track Record: If you have existing loans with the bank and pay on time, negotiate for a “loyalty rate.”

5. 0% Interest Schemes? Be Careful.

Some dealers advertise “0% Interest.”

The Catch: The machine price is marked up.
Example: Machine A costs RM 200k.
- Dealer 1: RM 200k + 5% Interest = RM 250k Total.
- Dealer 2: RM 250k + 0% Interest = RM 250k Total.
Reality: You pay the same. Always compare the Total Payable Amount.

Conclusion

Interest rates are important, but they are not everything. A low rate is useless if the loan takes 2 months to approve while your project is waiting. Balance cost with speed.

Need a rate quote today? Send us the model and year of the excavator you want to buy.

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Excavator Loan Interest Rates Malaysia 2026: Complete Guide