Everything You Need to Know About Borrowing from Licensed Moneylenders in Singapore – A Complete Moneylender FAQ

There are a few things you should think very carefully about when deciding whether applying to a licensed money lender for a personal loan is the right option for you. 

If you are facing financial distress or complications, there are several government agencies and social service agencies that might be able to offer you a financial assistance scheme. 

That said, if you are borrowing money for other purposes, such as to purchase or renovate real estate property or to pay off unexpected expenses, a quick cash loan may indeed be your best option. Naturally, everyone’s situation will always be different.

If you feel that borrowing from a licensed money lender is the best choice for someone with your unique circumstances, you should keep in mind that:

• You will be legally obligated to meet the terms of any loan contract you enter into with a licensed moneylender (in full)
• You must ensure you are fully and realistically able to repay any loan amount you sign up to borrow, plus interest, administrative fee costs and any other charges.
• Late repayment fees and late interest may apply if you are unable to repay your personal loan within your contract’s agreed time limit

Before you submit a loan application to any lender, we would highly recommend using a free loan comparison service like Loan Advisor to compare the market and see what kind of deals are available. Once you have found your ideal personal loan and are ready to apply, you should:

• Ensure the lender provides you with a copy of your loan contract, which fully explains the terms of the loan to you in language you fully understand (money lenders are required to do this by law)
• Carefully consider the agreed repayment schedule, interest rate charges and other fees and ensure you are 100% happy with them before you sign

If you are applying for secured loans, which are linked to fixed assets such as collateral or property, you should also think twice about any caveats a lender might try to lodge on the sale proceeds of your real estate property. Such terms could either prevent you from selling your home without repaying your lender in full first or wipe out a substantial portion of your proceeds after the sale – so be careful with this.

The amount of money you can borrow for a standard personal loan in Singapore will vary depending on whether you’re applying for a secured or unsecured loan – as secured loans will enable you to borrow any loan amount you please. 

Conversely, if you are applying for an unsecured loan, your monthly income or annual income may affect the total loan amount or “loan principal” you are apply to apply for – which could vary from lender to lender, too. There are also important differences between permanent residents foreigners and other types of borrowers. 

The table below breaks down the key differences you’ll need to be aware of when applying for unsecured loans:

As you can see, both permanent residents foreigners earning between $10,000 and $20,000 can borrow up to $3,000 as total personal loan amount, but foreigners below the $10,000 threshold can only access a maximum loan principal of $500. That said, any permanent residents foreigners residing in Singapore who earn more than the $20,000 upper limit can borrow up to 6 times their monthly income.

Most licensed moneylenders will ask you to provide evidence of the following documents when you apply for a personal loan:

• Passport, Driver’s Licence or other personal ID documents

• Proof of residence (e.g. utility bill, tenancy agreement or a letter addressed to you personally)

• Proof of employment (or an employment letter if you have been in your job for less than three months)

• Recent three months’ worth of payslips

• SingPass information (to log into relevant websites)

If you are a foreigner applying for licensed moneylender loans in Singapore, you might be required to provide evidence of further supporting documents to demonstrate your physical address and employment status here in Singapore, too.

All licensed lenders that are properly regulated by the Registry of Moneylenders and listed on the Ministry of Law’s approved lender list here have to play by certain rules. 

When it comes to interest rates, licensed lenders can only charge a maximum interest rate of 4% per month. A similar law applies to late interest, too – lenders will only ever be able to charge you 4% per month for each month your loan is late being repaid. That said, other late fee and administrative fee charges may apply, so watch out for these!

It’s also worth noting that lenders must calculate the loan interest they charge based on the principal loan amount left over after taking away any payments you have already made. This means that if you have borrowed a $10,000 loan principal and have already repaid $8,000, for example, your lender can only calculate interest based on the $2,000 you still owe them. Similarly, late interest can only be charged on the actual amount that you have repaid late. 

The latest rules governing interest rates and fees were laid down on 1 October 2015 – and you can keep an eye out for any future changes or updates here.

As we mentioned in the last section, you might still be eligible to pay late repayment fees and other charges under the agreed terms of your loan contract, even if late interest is capped at 4%. Despite this, the Registry of Moneylenders does impose strict limits on the kinds of fees licensed lenders are allowed to charge.

The table below documents the maximum fees licensed moneylenders can charge you in different categories, as defined the 1 October 2015 rules:

The fastest and easiest way to double-check whether a moneylender is properly licensed is to visit the Registry of Moneylenders website here and cross-reference your preferred lender’s name with their list of approved moneylenders. 

You can always guarantee that any licensed moneylender names or websites belonging to this list are properly regulated here in Singapore – which is why we would strongly recommend relying on this official website over any other consumer directories or licensed moneylender rankings you may have seen elsewhere. 

It’s also important to be very cautious of any money lenders whose terms sound suspicious, or any companies that may have contacted you via an unsolicited email or text message with an offer that sounds too good to be true.

Licensed moneylender advertisements can sometimes appear confusing or even a little misleading at first glance. But if you’ve stumbled across an ad that you’re unsure of, how can you tell whether it’s legit?

The easiest way to determine this is to double-check where the advertisement is placed. As of 1 November 2011, licensed moneylenders are only permitted to advertise via three approved channels, which include:

• Business or consumer directories
• Websites belonging to the licensed moneylenders themselves
• Billboards, posters or other advertisements placed within or outside a moneylender’s own business premises

In short, this means that any unsolicited emails, SMS messages or flyers posted under your door are most likely to be either:

• From unlicensed or untrustworthy moneylenders that you should avoid
• From licensed moneylenders who are in direct violation of the rules

As such, you should disregard and never respond to such advertisements. You should instead report them to the Registry of Moneylenders directly by calling their 1800-2255-529 hotline.

As we have already mentioned, all borrowers have an obligation to commit to the terms of their loan contract in full once this has been signed. That said, unforeseen circumstances can and do occur. If you do ever find yourself struggling to repay a personal loan, you should consider approaching social service agencies and/or credit counselling services for assistance in negotiating a debt repayment plan with your moneylender.

The following social service agencies and credit counselling organizations might be able to assist you:

• Credit Counselling Singapore Address: 51 Cuppage Road 07-06, Singapore 229469 
  Tel: 6225 5227 / 6338 2663
  Email: enquiry@ccs.org.sg 
• One Hope Centre Address: 8 New Industrial Road 04-04B LHK 3 Building, Singapore, 536200 
  Tel: 6547 1011
  Email: help@onehopecentre.org  
• Silver Lining Community Services Address: 11 Playfair Road, Singapore, (West) Jurong Spring CC, or: 8 Jurong West St 52, Singapore, 649296 
  Tel: 6749 0400
  E-mail: admin@silverlining.com.sg 
• Adullam Life Counselling Address: 151 Chin Swee Road 08-04 Manhattan House, Singapore, 169876 
  Tel: 9423 8832
  E-mail: admin@adullam.org.sg
• Association of Muslim Professionals Address: 1 Pasir Ris Drive 4 05-11, Singapore, 519457
  Tel: 6416 3960
  E-mail: corporate@amp.org.sg
• Arise2Care Community Services Address: No. 5 Harper Road, 02-01A, Singapore, 369673 
  Tel: 6909 0628
  Email: admin@arise2care.sg

• Blessed Grace Social Services Address: 16 Arumugam Road, 04-02B Block D, LTC Building. Singapore, 409961
  Tel: 8428 6377
  Email: billy.lee@blessedgrace.org 

You can find details of other agencies listed on the Ministry of Law’s official website here.

Before you fill in any loan application form, you need to be 100% confident that you are dealing with a legal money lender. The “red flags” listed below will help you to recognize when a moneylender might not be legit or properly licensed. Never trust a lender if they:

• Have promotions or marketing materials that do not comply with the latest rules governing licensed moneylender advertisements (outlined above)
• Ask you to sign a blank or incomplete Note of Contract as part of your loan application
• Don’t appear to have a physical address or proper business address
• Threaten you or use abusive language toward you
• Refuse to return your personal ID documents, NRIC card or Employment Pass
• Withold any part of your principal loan amount
• Offer you a loan without fully explaining the loan contract and terms and conditions in clear language you understand
• Fail to exercise due diligence, such as requesting personal ID documents, application forms and supporting documents
• Fail to issue you with a copy of your Note of Contract 
• Demand your SingPass user ID or password 

Spotting these warning signs before it’s too late should help you to avoid unfair practices, overinflated interest rates and fees and costly small claims tribunal cases. You should always report any suspected loan sharks not operating in accordance with the law to the Registry of Moneylenders. You can do this by contacting 1800-CALL-LAW.

If you want to apply for a loan quickly or you need cash urgently, you should compare loan quotes from licensed moneylenders in Singapore that offer fast cash disbursement. 

Most licensed moneylenders will offer faster application processes than banks, usually with a final decision made within 24 hours or less. That said, it’s important to compare exactly what different lenders are offering to someone in your unique situation to ensure you are getting the best deal possible.

On top of the ID and supporting documents we mentioned earlier, you might also need to meet certain eligibility criteria before you can qualify for a moneylender personal loan here in Singapore. In most cases, you will need to be:

• At least 21 years old 
• Earning a minimum monthly income of at least $2,000 if you are a Singapore Citizen or Permanent Resident
• Earning a minimum monthly income of at least $3,000 if you are a foreigner 

In some cases, you might also need to have a healthy credit score – but this will not be the case with all lenders. Licensed moneylenders do not tend to scrutinize your credit history as closely as a traditional bank might, and some lenders even offer loans specifically targeted at people with a low credit score. What’s more, taking out personal loans with licensed moneylenders can be a great way to improve a poor credit history if you are able to consistently make your repayments on time over the course of your agreed loan contract.

Some borrowers might wish to purchase a credit report from a recognized agency prior to applying for a loan, particularly if they are worried that their loan application might be rejected due to a poor credit score. As a general rule, most licensed moneylenders in Singapore will not perform a thorough check on an applicant’s credit history when they apply for a personal loan – but this may differ depending on your preferred provider.

We would suggest that obtaining a credit report beforehand is probably not necessary for most borrowers, but if you do wish to do so, you can use either the Credit Bureau Singapore (CBS) or the Moneylenders Credit Bureau (MLCB) to obtain your report. You can also double-check your eligibility for any moneylender loan by visiting the lender’s official website or submitting an application for a loan quote before you fill in any formal paperwork.

If you feel a licensed moneylender has treated you unfairly in either your loan contract or its communications with you, your first port of call should be the Registry of Moneylenders. You can contact them directly by calling 1800-2255-529 and all matters will be taken very seriously.

In most instances, you will be invited to attend a formal interview with Registry of Moneylenders officers to kick-start your complaint. You will be asked for full details of any unfair practices you feel your lender has indulged in. You will also be asked to prepare and present any relevant information and documents related to your loan, as well as evidence of any direct communications between yourself and your lender where you feel the lender has acted unfairly.

Should you wish to take the issue a step further, you can escalate your case to the Small Claims Tribunal or even a Singaporean Court under the Consumer Protection (Fair Trading) Act. When it comes to Tribunal or Court cases, the Court will have the power to intervene and set aside any loan transactions that it deems to be either “substantially unfair” or “exorbitant” – but you will need to provide well-documented evidence of this to support your case.

There are a number of things you can do immediately after you have been granted a loan to ensure that both you and the lender are acting in full accordance with your agreed loan contract and its terms. These include:

• Making sure your lender has delivered the correct loan principal amount you both agreed on in your contract
• Paying any monthly instalments in a timely manner to avoid late interest and late payment charges
• Making sure your lender supplies you with a statement of account for your loan at least twice annually (statements will usually be released in January and July)
• Requesting a receipt each time you make a repayment toward your loan principal (if your lender doesn’t automatically issue one)
• Double-checking any receipts and other documentation for your correct name, loan amount, address etc.

On top of this, you should keep all your loan documentation in a safe place, to ensure that you are able to provide evidence of your payments and any communication between you and the lender should a dispute arise at a later date.

No, licensed moneylenders are not allowed to issue loans online. You will have to make a trip down to their office and there are some contracts that will need to be signed between you and the loan officers.

Yes, your information submitted to us is safe and we do not spam.

Having a moneylender chase you for unpaid debt can be a very daunting situation – but the good news is that there are a number of important laws that all licensed moneylenders must follow when pursuing a customer for repayments here in Singapore. Debt collectors are fully within their rights to:

• Talk to your family, friends and co-workers to ask about your whereabouts
• Approach you personally in attempt to negotiate an instalment repayment plan

That said, licensed moneylenders are not legally allowed to do any of the following:

• Harass, threaten or try to intimidate you
• Vandalize your home
• Stalk you unlawfully
• Physically harm you in any way

Here in Singapore, the above actions are prohibited under the Protection from Harassment Act. If a moneylender that is chasing you for unpaid debt breaks any of these rules, there is a strong chance you are dealing with an unlicensed lender who should be reported. 

Debt collection in our country is closely regulated by the Credit Collection of Singapore (CCAS) Code of Conduct, and if you feel a debt collector has harassed you or acted unfairly, you need to speak out about this. You should:

• Call the police immediately
• File for a Protection Order
• Make an official complaint to the CCAS by following the processes outlined here

No, our service is absolutely free. Our platform our automatically match your requirement to qualifying licensed moneylenders in Singapore.

No, we are not a moneylender and we do not provide loan services. We are just an neutral party providing loan comparisons.