Complete Guide to Excavator Financing in Malaysia 2025

Excavators are essential machines for construction contractors in Malaysia. New excavator prices can reach RM500,000 to RM2 million. This makes it difficult for many contractors to buy with cash.

Excavator financing helps you get the equipment you need without depleting working capital. You can pay with affordable monthly installments.

This guide will explain everything you need to know about excavator financing in Malaysia.

Why Excavator Financing Matters for Contractors

Working capital is the lifeblood of a contractor’s business. If you spend all your money buying an excavator, you won’t have funds for:

• Paying employee salaries
• Buying raw materials
• Covering daily operating costs
• Taking on new projects

Excavator financing allows you to:

Preserve Working Capital Pay only 0-30% as down payment. The remaining 70-100% is financed. Your cash remains intact for other needs.

Get Equipment Immediately No need to wait years to save money. Apply today, get approval in 1-3 days, receive excavator within 2 weeks.

Build Business Credit Record Consistent monthly payments help build your company’s credit record. This makes it easier to get larger financing in the future.

Tax Benefits Monthly payments and interest can be deducted as business expenses. This reduces your company’s income tax.

Types of Excavator Financing in Malaysia

1. Hire Purchase

Hire purchase is the most popular option for contractors in Malaysia.

How It Works:

• You pay a down payment (0-30%)
• Balance divided into monthly installments
• Payment period 3-9 years
• After full payment, excavator becomes yours

Advantages:

• Full ownership after payment complete
• Fixed monthly payments easy to plan
• Can claim tax benefits
• No usage restrictions

Suitable For:

• Contractors who want to own excavators
• Long-term projects
• Stable and growing companies

Calculation Example:

• Excavator price: RM800,000
• Down payment (20%): RM160,000
• Loan: RM640,000
• Interest rate: 4.5% per year
• Period: 7 years
• Monthly payment: RM8,950

2. Finance Lease

Leasing is an alternative to hire purchase. It’s more flexible for large companies.

How It Works:

• You rent the excavator for a certain period
• Pay monthly rent
• End of period, can buy at residual price
• Or return and lease a new one

Advantages:

• Lower down payment (5-10%)
• Operating costs fully deductible
• Flexibility to upgrade equipment
• No depreciation worries

Suitable For:

• Short-term projects (1-3 years)
• Contractors who want frequent equipment upgrades
• Companies prioritizing flexibility

3. Equipment Loan

Standard bank loan to buy equipment. More formal process and takes longer.

How It Works:

• Bank gives loan directly to you
• You buy excavator with cash
• Repay bank with interest
• Excavator becomes loan collateral

Advantages:

• Interest rates may be lower
• Full ownership from start
• Can choose any supplier

Disadvantages:

• Slow approval process (2-4 weeks)
• Stricter requirements
• More complex documentation

Excavator Financing Application Process

Our process is designed to be easy and fast for busy contractors.

Step 1: Contact Us

How to Contact:

• WhatsApp: +6012-345-6789 (response within 1 hour)
• Phone: 03-1234-5678
• Email: info@ingheng.com
• Visit our office directly

Information to Prepare:

• Type of excavator you want
• Estimated price
• Desired payment period
• How long your company has been operating

Step 2: Free Consultation

We will:

• Understand your business needs
• Explain suitable financing options
• Calculate monthly payments for each option
• Answer all your questions

Duration: 30 minutes to 1 hour Cost: Free, no commitment

Step 3: Prepare Documents

We will provide a complete document list. Usually includes:

Company Documents:

• Company registration form (SSM)
• Financial statements last 2 years
• Bank statements last 6 months
• List of completed and ongoing projects

Director Documents:

• MyKad copy
• CTOS/CCRIS statement
• EA Form or income tax
• Salary confirmation letter (if any)

Equipment Documents:

• Quotation from supplier
• Excavator specifications
• Photos (for used excavators)

Step 4: We Process Application

Our team will:

• Review all documents
• Conduct credit assessment
• Submit to our financing panel
• Negotiate best rates for you

Duration: 1-3 business days for initial approval

Step 5: Receive Approval

You will receive:

• Financing offer letter
• Complete terms and conditions
• Monthly payment schedule
• Deadline to accept offer

We will explain all terms clearly. Ask anything you don’t understand.

Step 6: Sign Agreement

After you agree:

• We prepare official agreement
• You read and sign
• We process payment to supplier
• Supplier prepares excavator for you

Step 7: Receive Your Excavator

Within 2 Weeks:

• Supplier delivers excavator
• You check condition and documents
• Start paying monthly installments
• Start your project with new excavator!

Required Documents

Complete list of documents for excavator financing application.

Company Documents (Mandatory)

1. Business Registration

• SSM form (Companies Commission of Malaysia)
• Company incorporation certificate
• Form 24 & 49 (for Sdn Bhd)
• Company constitution

2. Financial Documents

• Audited financial statements 2 years (if any)
• Latest profit and loss statement
• Balance sheet
• Cash flow statement

3. Bank Statements

• Last 6 months for company account
• Must show healthy transactions
• No bounced checks
• Consistent minimum balance

4. Projects and Contracts

• List of completed projects
• Ongoing project contracts
• New project offer letters
• Project photos (if any)

Director/Owner Documents (Mandatory)

1. Identification Documents

• MyKad copy front and back
• Must be clear and not expired

2. Credit Reports

• CTOS report (we can check for you)
• CCRIS from Bank Negara (we can apply)
• List of existing loans
• Payment records

3. Personal Income

• EA Form last 2 years
• Income tax form (BE form)
• Personal bank statement 3 months
• Salary confirmation letter (if any)

Equipment Documents (Mandatory)

For New Excavators:

• Official quotation from supplier
• Complete excavator specifications
• Sales price and payment terms
• Product catalog (if any)

For Used Excavators:

• Quotation from seller
• Clear photos (front, back, side, cabin)
• Previous ownership documents
• Mechanical inspection report
• Service and maintenance records
• Odometer or operating hours

Additional Documents (If Applicable)

For New Companies (Less Than 2 Years):

• Director’s experience details in industry
• CV and qualification certificates
• Company paid-up capital
• First project or tender won

For Financing Over RM1 Million:

• Business valuation by auditor
• 3-year financial projections
• Complete business plan
• Return on investment analysis

For Bumiputera Contractors:

• Bumiputera certificate
• CIDB certificate (if any)
• Contractor association membership

Financing Eligibility Requirements

We understand every business is different. Our requirements are flexible to accommodate various situations.

Basic Requirements

Company Age:

• Minimum 2 years operating
• For new companies: Directors must have 5 years industry experience

Credit Record:

• No bankruptcy or insolvency cases
• No pending legal action
• Current loan payments on track
• CTOS/CCRIS clean or explainable

Stable Finances:

• Consistent company income last 6 months
• Positive profit margin
• Can comfortably pay installments
• Reasonable debt to equity ratio

Down Payment:

• 0-20% for new excavators
• 20-30% for used excavators
• Negotiable depending on application strength

Additional Criteria

For Premium Excavators (RM1 Million and above):

• Company operating minimum 3 years
• Strong project portfolio
• Audited financials required
• Minimum 20% down payment

For New Contractors:

• Directors have proven industry experience
• Have completed or ongoing projects
• Can show income sources
• Higher down payment (30%)

For Refinancing:

• Existing excavator purchased within last 3 years
• High outstanding value
• Current loan payments on track
• Want to switch to lower interest rate

Factors That Help Approval

Application Strength:

• Large project portfolio
• Long-term contracts
• Government or large corporate clients
• Clean audited financial records

Additional Collateral:

• Property as supporting collateral
• Other company assets (vehicles, land)
• Director’s personal guarantee
• Fixed deposits

Banking Relationship:

• Healthy bank statements
• No bounced checks last 12 months
• Good minimum balance
• Active business transactions

Interest Rates and Monthly Payments

We offer competitive interest rates with clear terms.

Current Interest Rates (2025)

Hire Purchase:

• New excavators: 4.5% - 6.5% per year
• Used excavators: 5.5% - 7.5% per year
• Depends on period and down payment

Finance Lease:

• Fixed rate: 5.0% - 7.0% per year
• Lower if shorter period
• Flexibility to negotiate rates

Equipment Loan:

• From 4.0% per year (for strong companies)
• Floating or fixed rate
• Negotiable with additional collateral

Monthly Payment Calculation Examples

Scenario 1: New 20-Ton Excavator

• Price: RM600,000
• Down payment (20%): RM120,000
• Loan: RM480,000
• Interest rate: 5.5% per year
• Period: 7 years
• Monthly payment: RM6,720

Scenario 2: Used 15-Ton Excavator

• Price: RM350,000
• Down payment (25%): RM87,500
• Loan: RM262,500
• Interest rate: 6.5% per year
• Period: 5 years
• Monthly payment: RM5,150

Scenario 3: Mini 5-Ton Excavator

• Price: RM150,000
• Down payment (15%): RM22,500
• Loan: RM127,500
• Interest rate: 5.0% per year
• Period: 5 years
• Monthly payment: RM2,405

Factors Affecting Your Rate

Company Profile:

• Strong finances = lower rate
• Clean credit record = lower rate
• New company = higher rate

Payment Period:

• Short period (3-5 years) = lower rate
• Long period (7-9 years) = higher rate
• Monthly payments vary by period

Down Payment:

• High payment (30%) = lower rate
• Low payment (10%) = higher rate
• More capital you invest, better terms

Excavator Type:

• Famous brands (Caterpillar, Komatsu) = lower rate
• New excavators = lower rate
• Old used excavators = higher rate

Financing Benefits vs Cash Purchase

Many contractors ask: “Better to buy cash or use financing?” Here’s an honest comparison.

Financing Benefits

1. Preserve Working Capital Cash is the lifeblood of business. With financing:

• Pay only 0-30% down payment
• 70-100% balance remains in business
• Can cover daily operating costs
• Have buffer for emergencies

2. Get Excavator Faster No need to wait years to save money:

• Apply today, get within 2 weeks
• Can take projects immediately
• Don’t lose tender opportunities
• Competitors get projects if you wait

3. Build Business Credit Good payment record helps future:

• Easy to get larger financing
• Lower interest rates for next loans
• Banks see your company as trustworthy
• Opens opportunities for working capital loans

4. Tax Benefits Monthly payments and interest are tax deductible:

• Reduce company income tax
• Excavator depreciation can be claimed
• Save thousands of ringgit every year
• Consult accountant for full benefits

5. Financial Flexibility Your cash can be used for:

• Taking new projects
• Buying raw materials
• Paying salaries and overhead
• Investing in marketing
• Expanding business

When Cash Purchase Is Better

If You Have:

• Excess capital not being used
• Don’t want monthly commitments
• Get big discount for cash payment
• Don’t mind reducing liquidity

If You:

• Large company with strong reserves
• Don’t need financing to build credit
• Want to avoid interest completely
• Have strong long-term financial plan

Cost Comparison

Example: RM500,000 Excavator

Option 1 - Cash Purchase:

• Pay: RM500,000 today
• Working capital lost: RM500,000
• Interest: RM0
• Total cost: RM500,000

Option 2 - 7-Year Financing:

• Down payment: RM100,000 (20%)
• Pay installments: RM5,600/month × 84 months = RM470,400
• Working capital retained: RM400,000
• Total interest: RM70,400
• Total cost: RM570,400

But with financing:

• RM400,000 remains in business
• Can generate income with this money
• Interest RM70,400 tax deductible (save ~RM16,900)
• Actual cost: RM553,500

Analysis:

• Pay RM53,500 more over 7 years
• But get to use RM400,000 to generate income
• If RM400,000 gets 5% return per year × 7 years = RM140,000
• You profit RM86,500 by using financing!

Frequently Asked Questions (FAQ)

Process and Approval

Q: How long does excavator financing approval take?

A: Fast approval within 1-3 business days with complete documentation. Banks typically take 2-4 weeks. We can give initial approval within 24 hours for urgent cases.

Q: Do I need perfect credit record?

A: Not necessarily perfect. We understand every business has challenges. As long as:

• No bankruptcy or insolvency cases
• Can explain past credit issues
• Have proof situation has improved
• Current finances stable

We will assess application comprehensively, not just credit score.

Q: What is the minimum down payment?

A: Depends on excavator type:

• New excavators: 0-20%
• Used excavators: 20-30%
• Premium excavators: 20-30%

Higher down payment gets lower interest rate.

Excavator Types and Periods

Q: Can I get financing for used excavators?

A: Yes! We provide financing for used excavators up to 10 years old. Requirements:

• Excavator in good condition
• Have mechanical inspection report
• Complete ownership documents
• Down payment 20-30%

Q: What excavator brands qualify for financing?

A: All famous brands accepted:

• Caterpillar, Komatsu, Hitachi, Kobelco
• Hyundai, Doosan, Volvo, JCB
• SANY, XCMG, LiuGong, Lonking
• Sumitomo, Kubota, Yanmar

For less known brands, we will assess based on market value and condition.

Q: What is the maximum financing period?

A: Depends on excavator age:

• New excavators: up to 9 years
• Used excavators (0-5 years): up to 7 years
• Used excavators (5-10 years): up to 5 years

Finances and Payments

Q: Can I pay early without penalty?

A: Yes! No early payment penalty. We even encourage if your cash flow is good. You can:

• Pay partial balance
• Settle loan completely
• Save interest for remaining months

Q: What happens if I pay late?

A: We understand business challenges. If there are problems:

• Contact us BEFORE deadline
• We can arrange payment postponement
• Or restructure loan
• Late penalty charged after 14 days

Q: Can I refinance existing excavator?

A: Yes, you can! If you bought excavator at high rate:

• We can refinance at lower rate
• Reduce monthly payments
• Extend period if needed
• Excavator must be purchased within last 3-5 years

Documentation and Requirements

Q: I’m a new contractor, can I apply?

A: Can! Even if new company (less than 2 years):

• Directors must have 5 years industry experience
• Show first project or tender won
• Higher down payment (30%)
• Prepare CV and qualification certificates

Q: Need audited financials?

A: For loans less than RM500,000:

• Regular financial statements sufficient
• Bank statements 6 months
• Project list

For loans RM500,000 and above:

• Audited financials 2 years
• Or financial projections by licensed accountant

Q: I have CTOS case, can I apply?

A: Depends on case type and status:

• If already settled: Can apply
• If currently paying: Can consider
• If new and serious: Difficult to approve

But we assess each case individually. Contact us for free consultation.

Why Choose Ing Heng Credit & Leasing

30+ Years Experience

We’re not a new company. Since 1990, we’ve helped thousands of contractors get equipment financing:

• 30+ years experience in financing industry
• Understand specific needs of Malaysian contractors
• Wide and strong financing panel
• Close relationships with excavator suppliers

high approval rate Approval Rate

We’re proud of our high approval rate:

• high approval rate complete applications approved
• We try our best to help you
• Have various financing options
• If one panel doesn’t approve, try another panel

Fast and Easy Process

Time is money in contractor business:

• Approval within 1-3 days
• Minimum documentation
• We help prepare documents
• Deliver excavator within 2 weeks

Personal Service

You’re not just a number to us:

• Dedicated officer for each client
• Can WhatsApp anytime
• Come to your office or site
• Follow up until you get excavator

Competitive Rates

We compare rates from various panels:

• Negotiate best rates for you
• Flexible terms
• No hidden charges
• Full transparency

Contact Us Today

Don’t delay anymore. The excavator you need can increase your company’s income. Every day waiting is opportunity lost.

How to Contact

WhatsApp (Fast Response): +6012-345-6789 Send message now - we reply within 1 hour

Phone: 03-1234-5678 Speak with our officer now

Email: info@ingheng.com For detailed inquiries and documents

Office: Ing Heng Credit & Leasing Sdn Bhd Lot 123, Jalan Industri 4/5 Taman Perindustrian Subang 47500 Subang Jaya, Selangor

Operating Hours: Monday - Friday: 9:00 AM - 6:00 PM Saturday: 9:00 AM - 1:00 PM Sunday & Public Holidays: Closed

Next Steps

1. Contact us via WhatsApp or phone
2. Explain your needs for excavator
3. Get free consultation and rate calculation
4. Prepare documents with our guidance
5. Receive approval within 1-3 days
6. Get your excavator within 2 weeks!

Our Promise to You

• ✅ Response within 1 hour (office hours)
• ✅ Free consultation without commitment
• ✅ Full transparency about costs and terms
• ✅ Continuous after-sales service
• ✅ Dedicated officer for each client

Let’s start your journey to own your own excavator. Contact us now!

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This article is written by the Ing Heng Credit & Leasing team to help Malaysian contractors understand the excavator financing process. For free consultation and latest terms, please contact us.