1. What is the Points and Fees Test?

The Points and Fees Test is used in Malaysia to determine if the sum of charges for a financial product is within the regulatory cap. It helps ensure fair pricing and consumer protection in financial transactions.

2. How Does the Calculator Work?

The calculator uses the simple comparison:

Where:

• \( \text{Charges} \) — Total fees and charges (MYR)
• \( \text{Cap} \) — Regulatory maximum allowed (MYR)

Explanation: The test simply compares whether the total charges are less than or equal to the regulatory cap amount.

3. Importance of Points and Fees Test

Details: This test is crucial for compliance with Malaysian financial regulations, ensuring that consumers are not overcharged for financial products and services.

4. Using the Calculator

Tips: Enter all charges in MYR and the applicable regulatory cap in MYR. The calculator will determine if the charges meet the regulatory requirement.

5. Frequently Asked Questions (FAQ)

Q1: What charges should be included?
A: Include all fees, points, and charges associated with the financial product as specified by Malaysian regulations.

Q2: Where can I find the current cap amount?
A: The cap amount is typically set by Bank Negara Malaysia and can be found in the relevant financial regulations.

Q3: What happens if the test fails?
A: If the sum of charges exceeds the cap, the financial product may need to be restructured to comply with regulations.

Q4: Does this apply to all financial products?
A: The test typically applies to specific regulated financial products like loans and credit facilities.

Q5: How often should this test be performed?
A: It should be performed whenever structuring a new financial product or when charges are modified.