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Ultimate Guide to Licensed Money Lender in Singapore

Couple Applying Loan From A Reliable Money Lender Singapore

Whenever in need of financial assistance, make sure that you only apply from a licensed money lender. This is because loan sharks are rampant, waiting for the vulnerable to deceive victims of their pretentious promotions.

Rest assured, the business of money lending is governed by the Ministry of Law for the purpose of protecting the rights and well-being of borrowers.

More importantly, when you default from payment of loans, they cannot resort to harassment, intimidation, and threat. Avoiding engagements with predators will guarantee your safety above all.

Things to Consider Before Borrowing

Like in many other things, there are a variety of factors to keep in mind before availing your much-awaited loans. We’ve listed them down to help you:

  1. Remember to never borrow to pay off another debt. As much as possible, do not apply for deals to cover up an existing one. If you can afford to pay off your debts reasonably simply by being dedicated and financially responsible, then that’s what you can do. Note that most strategies in paying down debt off new loans do not work for everyone.
  2. Ask yourself if you really need the loan and what is your purpose behind. Before anything else, it is ideal to double-check whether your goal in getting a loan is reasonable. As it is urged, you shouldn’t take a loan in order to live a lifestyle you cannot afford. Better yet, never borrow cash that you cannot repay. Some purchases that seem necessary for your goals might also come with higher-end options that are not justifiable.
  3. Can you afford it? Understand the term of the loan, from its repayment schedule, interest, loan amount, and other fees. Even when borrowing, working out on a budget is necessary. Practice in calculating the amount you will be repaying including all the payments and extra costs. You can easily compare that with what you earn to balance your current and future expenses. Take note that loans should be within a borrower’s means. Avoid overspending and control your cashouts.
  4. Verify if a moneylender is licensed by the Ministry of Law. Singapore law requires licensed moneylenders to explain the terms of your loan in a language clients can easily understand. If one hands you a contract and refuses to explain the terms in the language that you understand, it’s very likely that you are dealing with a loan shark.
    Licensed moneylenders also always have you sign a contract. It must be printed copy and include information on the interest rate, late payment fees, the repayment period, and other necessary details.
  5. Shop around to find the best rates and customized loan plan for you. To find the best deal that suits your financial worries, there is no harm in shopping around to get the ideal rates. This allows you to select from a variety of licensed lenders that meet your demands. Consider all the contributing factors that may affect your account, credit score, as well as your future purchases and transactions.

What Type of Loans Can You Borrow from Licensed Money Lenders?

There are two major types of loans, secured and unsecured ones. As the name implies, unsecured loans have no collateral backing, thus, requires no security. Should a borrower defaults on this type of loan, the lender must initiate a lawsuit to collect what is owed.

With this, lenders will issue funds based only on the borrower’s creditworthiness and promise to repay. On the other hand, secured loans are wherein the borrower puts up their assets as collateral for the deal. With this, the lender can use the asset to repay the funds it has advanced the borrower.

Moreover, these are the kinds of loans people can apply from most lenders in Singapore:

Personal Loan & Foreigner Loan

In Singapore, this deal does not require borrowers to provide any collateral such as house, car, or other possible assets to avail deals. It is approved only based on creditworthiness, which depends on your credit score, monthly or annual income, repayment history, employer reputation, etc.

It can be used for multiple purposes, like meeting expenses of a medical emergency, travel, house renovation, as well as debt consolidation, etc which comes with flexible tenure either for the short term or long term.

Features Banks Moneylenders
Loan amount Up to 10x monthly salary Up to 6x monthly salary
Interest rate From nearly 4% p.a. Up to 4% per month
Repayment period Up to 5 years Up to 12 months subject to the terms & conditions of the agreement
Application approval A few days Within 30 minutes
Eligibility Must be 21 years old and have a minimum annual income of $30,000 for citizens and permanent residents and $40,000 for foreigners Must be 18 years old with a minimum annual income of $18,000 for citizens and permanent residents and $24,000 for foreigners
Typical requirements For citizens and PR: NRIC, proof of income, and proof of residence.

For foreigners: Passport, work permit, proof of residence, income, and employment letter

In general, banks have higher requirements for you to qualify.

Payday Loan

Payday loans are a short-term loan that can help you cover immediate cash needs until you get your next paycheck. These are typically due within two weeks—or close to your next payday. It functions differently than personal and other typical deals. Depending on where you live, you can get a payday loan through a physical branch with a payday lender.

Moreover, accessing a payday loan is convenient as borrowers only need to meet a few basic requirements, which includes a stable source of income. As long as the income is consistent, you are almost guaranteed to find a willing lender.

As the name indicates, in a Payday Loan, you can borrow up to one month’s worth of your salary to help with your short-term financial issues and repay it back on your next paycheck.

Features Moneylenders
Loan amount Up to 1 month of your salary
Interest rate Up to 4% per month
Repayment period Within a month or on next payday
Application approval Within 30 minutes
Eligibility Must be 18 years old with a minimum annual income of $18,000 for citizens and permanent residents and $24,000 for foreigners
Typical requirements For citizens and PR: NRIC, proof of income, and proof of residence.

For foreigners: Passport, work permit, proof of residence, income, and employment letter

Monthly loan

Similarly to payday loans, this type of deal is on a term-basis. If you want to find a way to pay for your home improvements, vacations or even pay back your car loans, this can still be the right service for you. Monthly loans are likely to offer you stability when you have a tight budget.

Features Moneylenders
Loan amount Up to 6x monthly salary
Interest rate Up to 4% per month
Repayment period Up to 12 months subject to the terms and conditions of the agreement
Application approval Within 30 minutes
Eligibility Must be 18 years old with a minimum annual income of $18,000 for citizens and permanent residents and $24,000 for foreigners
Typical requirements For citizens and PR: NRIC, proof of income, and proof of residence.

For foreigners: Passport, work permit, proof of residence, income, and employment letter

Business Loan

Given, as the name suggests, this type of package is something you can avail in meeting urgent needs for your growing business or ventures. These are welcome for start-ups and small businesses are corporate entities.

If their commercial activities indicate their earning and growth potential, banks will quickly rally behind them. On the other hand, CEOs and sole proprietors with bad credit can always seek help from a licensed lender, who can then offer them up to S $200,000 payable within a year.

Features Banks Moneylenders
Loan amount Up to $500,000 Up to $200,000
Interest rate From nearly 12% p.a. Up to 15% per month
Repayment period Up to 5 years Up to 2 years subject to the terms & conditions of the agreement
Application approval A few days Within 30 minutes
Eligibility
  • The company must be registered in Singapore
  • 30% of shareholders have to be Singaporean PRs or citizens
  • Business must be operational for at least 2-3 years
  • No more than 10 employees or annual turnover not exceeding S$1 million
  • The company must be registered in Singapore
  • Operational for at least 1 year
  • Has a minimum turnover of $60,000
Typical requirements NRIC of all business partners, profile, income tax notice, financial statement, utility bills, tenancy agreement, etc.

Banks may require a guarantor.

Bridging Loan

Bridging loans are specially designed for Singaporeans who want to purchase a new property, like a house or flat, but need to borrow additional capital to fund the purchase. These loans can help you bridge a financial or working capital gap when upgrading or moving home.

Features Banks Moneylenders
Loan amount 15- 20% of the purchase price of your new home Up to 6x monthly salary
Interest rate 5-6% p.a. Up to 4% per month
Repayment period Up to 6 months Until your house completion date
Application approval A few days Within 30 minutes
Eligibility N/A
  • At least 18 years old
  • Exercised the option to purchase OTP
  • No minimum salary required
Typical requirements NRIC, copy of the OTP, proof of residence, and income

Assurance You Will Get When You Borrow from Legal Lenders:

  1. Reasonable rates. Given that all licensed moneylenders abide by the rules of the Ministry of Law, it is guaranteed institutions cannot charge your loans with rates over what the guidelines set.
  2. Fast approval. Unlike banks, with most lenders, you can quickly get what you have applied for. More often than not, you can easily have your loan approved after thirty minutes.
  3. Safe and transparent. As it is reminded that these legal lenders in Singapore, they only do their business according to the law and regulation set by the Ministry of Law. This ensures all transactions are secured and transparent with written terms.
  4. Flexible requirement. Unlike other institutions, one can be conveniently offered service with enough information from your personal documents for the application.

How the Laws Protect Your Rights When You Borrow from Licensed Lenders

  1. Advertising restrictions:
    Licensed moneylenders can only advertise on their business website or just outside their office, as well as in business directories.On the other hand, they cannot send you SMSes about their services or advertise in newspapers/social media platforms. They are also prohibited in making false or misleading statements just to get you to borrow. It’s assured lenders cannot invite you to take a loan or grant you with it without applying for it as well.
  1. Requirements when granting a loan:
    Before granting you a loan, moneylenders must,
    • Explain the terms of your loan in a language that you can understand;
    • Give you a signed copy of the deal which include the terms in writing;
    • Give you a separate cautionary statement in writing;
    • Issue you a receipt for every repayment made towards the loan; and
    • Provide the borrower with a statement of accounts once every half in July or January.
  1. Caps on loan costs:
    Licensed moneylenders should not structure your loan such that you are likely to incur overdue fees or administrative charges many times because you are unable to repay the loan or instalments on time. Should you encounter any lender, breaking these regulations, you can lodge a complaint with the Registry of Moneylenders.
  1. Caps on the loan amount:
    The maximum amount you can borrow from all legal or licensed moneylenders combined for unsecured loans is:
Borrower’s Annual Income Singapore Citizens and PRs Foreigners residing in Singapore
Less than $10,000 $3,000 $500
At least $10,000 and less than $20,000 $3,000 $3,000
At least $20,000 Six times monthly income Six times monthly income
  1. Debt collection:
    Licensed moneylenders can take steps to recover their debts from you. They may engage debt collectors to help them. However, violent threatening or harassing behaviour is not allowed.This includes: stalking you or your family members; sending unenclosed notices of demand to your workplace, openly displaying notices of demand outside of your residence and/or calling you repeatedly at unreasonable hours, as well as disturbing you around affecting your neighbours.

If You Accidentally Borrowed from Loan Sharks, Here Are Loan Advisor’s Steps You Must Keep in Mind:

  • Keep calm.
  • Don’t make any or additional payment.
  • Contact the Police at ‘999’ or the X-Ah Long hotline over at 1800-924-5664.
  • You can easily check the list of legal lenders in Singapore that are under the Ministry of Law online to avoid potential problems in the future.

While you experience financial difficulties, understand that there could be a ton of strategies to consider just to get through it. In situations like this, it’s best to consider getting help from a moneylender, specifically the licensed ones to guarantee a smooth transaction, and more importantly, your safety.

You can check deals and packages from 365 Credit Solutions, the best licensed money lender in Singapore! It offers same-day loan approval with low-interest rates. Call or apply online then visit their offices to sign a loan contract and receive your loan.

About 365 Credit Solutions

365 Credit Solutions Pte Ltd is an established licensed moneylender since 2010 (formerly known as FLS Credit and Fu Lu Shou Credit), accredited by the Registry of Moneylenders in Singapore. We specialize in providing personal, payday, bridging, foreigner, business loans to Singaporeans & Foreigners working in Singapore.

 

Our mission is to help make taking a loan a simpler, more understandable process, and to educate our customers about their loan options in the event of an urgent need.

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