What is a licensed money lender?
A licensed money lender is a private entity providing financial assistance to those seeking alternatives from bank loans, mortgage loans, or credit card loans. Unlike most bank loans, licensed money lenders in Singapore offer unsecured loans, which allows them to disburse loans as low as $200 whereas the minimum amount for a bank loan is $10,000.
What are the interest rates a licensed money lender in Singapore can charge?
The maximum interest rate a licensed money lender in Singapore can charge is 4% per month, based on the reducing principal balance calculation method. However, if payment is delayed, a maximum of 4% late interest fee per month will be incurred.
What other fees can a Licensed Money Lender charge?
All SG-licensed money lenders are permitted to impose the following charges:
- A 10% administration fee of the principal of the loan.
- A late fee not exceeding $60 per month of late repayment.
- Legal costs ordered by the court for a successful claim by the money lender for the recovery of the loan.
How much money can I borrow from a Licensed Money Lender in Singapore?
According to the ministry guidelines, the credit limit for a Singaporean or PR borrower to loan across all licensed money lenders in Singapore is capped at a total of 6 times of the borrower’s monthly income who earns a total $20,000 or more a year. For annual income below $20,000, they can only loan up to $3000. Usually, loan officers will offer loans of 1 to 3 times of the borrower’s monthly income. Depending on the borrower’s preference, loan amounts can also range from as low as $200 to as high as $50,000.
What kinds of repayment/term plans does a Licensed Money Lender offer?
Licensed money lenders in Singapore offer a variety of term plans from weekly loans to monthly loans. Repayment duration of each loan will vary between 1 month to 12 months. Repayment plans are available depending on the borrower’s trade or preference:
i.e. Jamie takes a personal loan of $3000 on 5th August with a 3-month repayment plan. She will pay for her loan on the 5th of every month for the next 3 months. Her payment schedule will fall on 5th September, 5th October and 5th November.
How can I make my payments? What are the payment methods available?
Upon receiving your loans, your loan officer will provide you with a name card with a bank account number printed on it. You can transfer payments through online banking or deposit your payment straight into the account provided. Alternatively, you may make your payments in cash at the office during office hours.
What happens when I have trouble meeting my payment due dates?
If you’re having troubles meeting your payments, you can inform your money lender and notify them of the earliest that you can make your payments. Please note that late fees, late interest and compound interests will be incurred in the event of a late repayment.
What are the requirements to take up a personal loan from a licensed money lender in Singapore?
Some basic requirements include:
- Borrowers must be between 18 to 65 years of age.
- Borrower must be Singaporean, PR or possess a valid foreign work pass (i.e. Work permit, S-pass, E-pass)
- Borrower must be currently employed full-time or running their own business or freelance with a source of monthly income (e.g. Grab/Gojek drivers)
- Borrowers must not be or have been declared bankrupt or DRS.
What documents do I need to bring along with me when I apply for a personal loan in Singapore?
You will need to bring these following documents:
- Singaporeans and Permanent Residents: 18 Years old and above.
- Proof of identity; NRIC
- SingPass login credentials to check your monthly CPF contributions, and NOA.
- Latest 3 months income proof (for self-employed).
- Foreigners: 18 years old and above
- Must be working and residing in Singapore.
- Bring passport, proof of employment (Work permit, E-pass, S-pass, other proof of employment), proof of Income (latest 3 months’ Payslip), proof of residency (tenancy agreement or bills addressed to the applicant).
How can I apply for a personal loan in Singapore from a licensed money lender?
Fill out an application and select one or more companies from our list of recommended licensed money lenders in Singapore. You can expect replies within 30 minutes to schedule an appointment for an interview and loan processing. Alternatively, you can visit a licensed money lender of your choice and fill out an application on the spot in their respective loan office.
What is the loan process for a licensed money lender in Singapore?
It usually takes less than 30 minutes to get a personal loan in Singapore from a licensed money lender. The process starts with the application and an interview with a loan officer. During the interview, the loan officer will conduct a credit assessment and come up with a personal loan catered to your financial needs. Once the loan officer approves your loan application, your loan will be disbursed to you in cash, on the same day of your visit.
What type of loans do legal money lenders in Singapore offer?
Legal money lenders in Singapore offer various types of unsecured loans such as Personal Loans, Payday Loans, Micro Loans, Business Loans, Foreigner Loans, Bridging Loans, and Debt Consolidation Loans.
How will I know when my payments are due?
Your repayment dates will be stated in the contract that will be briefed to you by your respective loan officer before you receive your personal loans. Additionally, the loan office will send you reminders before your payment dues so that you’ll never miss them.
To what extent can a licensed money lender in Singapore take legal action against default payments?
In the event where the borrower becomes uncontactable, the money lender will send a debt recovery team to the borrower’s residential address. The lender will resort to taking legal action against the borrower if the borrower refuses to adhere to the debt recovery team. All licensed money lenders in Singapore are advised to follow The Professional Handbook on all aspects of money lending and debt recovery.
