The Definition of Public Transport Development Fund (TPPA)

TPPA is a loan financing fund specifically for bus and taxi operators licensed under the Commercial Vehicles Licensing Board Act 1987 (Act 334). The fund is provided for the purchase of vehicles in order to increase the quality of service (which includes individual and company/ cooperative/ firm operators).

Programme Objectives

The objectives of this programme are to:-

	Provide a special financing facility especially for commercial buses and taxis service operators throughout Malaysia with more flexible terms and competitive rates
	Encouraging economic growth in the public transportation industry and other related businesses whilst contributing to the socio-economic development and improving the quality of the nation’s public transportation services
	Assisting entrepreneurs in the public transportation in bus & taxi sector to increase its competitiveness with high levels of service quality

Applicant Eligibility/Target Group

These funds are targeted specifically for bus and taxi operators. Terms of applicants are as follows: -

Item	Individual Applicant	Company/ Cooperative/ Firm Applicants
Ownership Status	Open to all Malaysian	Open to all Companies/ Cooperatives/Firms owned by Malaysians
Business Registration	None	Company registered with the Companies Commission of Malaysia (SSM) Cooperatives with valid registration from the Cooperative Commission
Licence from CVLB	Own a licence or Offer Letter of Approval (STK) from CVLB registered in own name/ company/ cooperative/ firm
Project	Project must be viable with the ability to service the loanand operated by the licence holder or STK

*Note: The evaluation of individual applications will be undertaken by MARA.

Public Transport Operators Eligible for Funding

1.Bus and taxi operators which are eligible to apply for financing under this programme are as follows: -

Buses Express Bus Stage Bus Shuttle Bus School Bus Factory Bus Charter Bus Mini Bus

Taxis/ Rental Car Taxis Rental Cars Limousine Airport Taxis Rent and Drive Cars

2. Or any other classes of public service vehicles established under Act 334 from time to time.

Note: Tour bus operators and self-drive vehicles are not eligible under this program.

Rules and Conditions of Funding

1. General Terms of Financing

Items		Description
a.	Financing Facility Amount	Minimum : RM30,000 Maximum : RM10.0 million
b.	Financing Period	Taxis / Rental Cars: Maximum of 5 years or the remaining useful life of the taxi / rental car,whichever is lower Bus: Maximum of 10 years, for Express bus is 8 years or remaining useful life of the bus, whichever is lower Nota :The maximum period of financing should not exceed the remaining useful life of the vehicle that has been set by the CVLB to prevent the vehicle from being changed whereas loan balance still remains. For example, the useful life of taxis does not exceed 7 years, Express buses do not exceed 10 years and school buses do not exceed 20 years
c.	Financing Purpose	Purchase of new or reconditioned vehicles for new licences or STK or replacement of old vehicles Improving the quality of vehicles (such as conversion to NGV, installation/ conversion of audio/ video, seats, air conditioning, body paint and other modifications). Financing to cover the cost of repairs due to accidents is not permitted Financing for working capital is only allowed for bus and taxi operators with the company/ firm/ cooperative status only (individual operators are not allowed) Refinancing of existing loans is not permitted Nota : Purchase of reconditioned vehicles must be in accordance with rules established under CVLB Act 1987
d.	Type of facilities	Financing offered through the conventional and Islamic methods: Ijarah and Ijarah Thummalbai (ITB) Bai Bithaman Ajil (BBA) / Term Loans Industrial Hire Purchase (IHP) Leasing
e.	Profit Rates	The profit rate charged is 4.0% per annum calculated on the remaining annual installments (annuities) This rate is equivalent to around 2.5% per annum for a period of 5 years
f.	Margin of Financing	Up to 100% of the vehicle price and repair costs depending on the type of financing instruments offered and also the credit risk rate of the project

2. Charges/ Fees

	For individual applicants, a payment of RM50 will be charged for each application
	For applicants of companies / firms / cooperatives, 0.15% of the total loan amount approved or RM 10,000 will be charged for each application, whichever is lower

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