365 Credit Solutions Pte Ltd is a licensed moneylender (License No. 17/2024) listed in the Registry of Moneylenders, under the Ministry of Law in Singapore.​

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Moneylenders vs Banks Legal Loans: How the Rates Compare

A man signing legal loan contract

In Singapore, the colloquial term for a loan shark is Ah Long, illegal moneylenders who prey on those clients who are not qualified for a licensed loan from licensed money lenders or urgently need fast credit cash from any moneylender. 

According to the Anti-Crime, Drug, and Social Development Voluntary Organisation of Singapore and the National Crime Prevention Council, these illegal moneylenders charge about 40% of the unsecured loans they release with a payment schedule per month or fortnight, significantly higher than the credit taken from a licensed money lender. 

The best way to prevent yourself from falling into debts from the loan shark lending is not to engage with their loan services in the first place. It is crucial that you, no matter how hard your financial difficulties, not support this unlicensed moneylending service. 

4 Types of Personal Loans

If you are in a pinch and decide to take out a best personal loan in Singapore from licensed moneylenders under the Singapore Ministry of Law, you are free to do basically anything you want to do with the cash loan. 

To help you make that decision, the following are the four types of personal loans in Singapore that are legal.

1. Unsecured Personal Loans

These loans are approved without you, the applicant, having to present collateral to the money lender. The money lender in Singapore decides whether or not to allow you to borrow money from them based on certain terms and conditions. 

If you have a good credit history, then the personal loan can be approved by the credit company or licensed moneylender faster. These personal loans pose high risks for the money lender in Singapore, which needs to be compensated by charging a higher amount interest.

Despite the name, there is no rule that states the need for customers who avail of these loan options to use it strictly for loan personal activities. There is no need to get a licence for using it as a business loan addressing the needs of your company in Singapore. 

The money you receive when you apply for a loan can be spent on your current business interest, no approval is needed from the loan officers. The loan personal money is a flexible credit from money lenders in Singapore, with all rights reserved for the borrower.

2. Secured Personal Loans

On the other hand, secured personal loans are those where moneylenders in Singapore need to be presented with a valuable asset as collateral during loan application. 

This could be your house, your car, jewelry, basically anything that the legal money lender gives the approval on to be made as collateral. 

These loans have the lowest interest rates due to the lower risks for the moneylender in Singapore. However, you should be careful to note and pay the installments for the loan on time, for when you default, licensed moneylenders in Singapore have their rights reserved by the Registry of Moneylenders allowing them to seize and take ownership of your collateral.

3. Fixed-Rate Loans

As can be sourced from its name, fixed-rate loans are those that have a fixed monthly repayment and corresponding interest rate within their loan tenures, regardless of whether they are a business loan, a cash loan, or are simply loans personal. 

Throughout your loan tenure, you will be paying the exact amount agreed in your payment plan when you submitted your application forms, hence it is crucial to take note of this detail. 

This is helpful for those who want to budget their financing solutions into a loan plan to address problems in their loans personal credit, credit checks, cash flow, and fast cash loans and mold it into their monthly expenses. However, you cannot benefit whenever there are service promos for a decrease in interest rates.

4. Variable-Rate Loans

Opposite that of the previous type is the variable-rate loans, where you pay varying interest rates throughout the entirety of your loan tenure with licensed money lenders in Singapore. 

This can make budgeting your needs and debt consolidation a challenging task as your loan application repayments are fluid and depend on the market conditions of the present. You can benefit from falls in interest rates of loans in Singapore however, so if you want to take the risk, you can opt to get these cash loans.

Pros and Cons of Taking Loans

There are two options that you can choose from when you need to take out a personal loan here in Singapore, both of which have a legal licence to operate. 

You can either apply to a bank, or you can apply to a licensed moneylender. Both of these credit institutions are licensed to give you credit, and whatever choice you follow, you can be ensured of your safety. 

However, there is a stark difference between the two, and it is crucial that you know of their credit privacy policy (Pte Ltd), processing fees, and competitive rates before making your decision.


Banks offer loans (loan business, loan foreigner, and other cash loan types that address their clients’ credit needs) with a higher amount and longer tenure, but need an exemplary credit history as part of their privacy policy. 

They also offer more credit options and licence for what you want to do with your money, whether you want to receive it in cash or invest it somewhere else. Banks have higher loan amounts that give you more opportunities to invest and secure your finances. However, these perks come at the price of having your credit score extensively scrutinized by their staff, and thus approval for bank loans also takes longer.


On the other hand, personal loans from licensed moneylenders are delivered quickly to their customers, you can access the credit money within an hour or so after application, as long as your documents are complete. 

These moneylender institutions in Singapore have fewer licence requirements compared to banks, thus if you have a lower credit score, all hope is not lost in getting a loan as you can choose to borrow from the moneylender and other types of credit lenders instead. 

However, moneylenders charge higher interest rates than banks, and for a relatively shorter time period as well. Also, they typically have a maximum loan amount for their customers, as their business runs on higher risks due to their lower standards for who can be approved in them.

Comparison Table

To better understand how banks and licensed moneylenders really fare against each other in terms of customer service quality, the following table is presented. You can choose which credit option here in Singapore is best for your current financial situation.

Banks Licensed Moneylender
Application Process Slow (about 24 hours or more) Quick (within an hour with the loan disbursed within the day)
Loan Amount Higher Lower (regulated by the government)
Interest Rate Low High (regulated by the government)
Tenure Long Short
Charges and Other Fees Low High

How to Find the Best Personal Loan

Deciding where to get your licensed personal loan to get money for your new business interest can be challenging, especially when you are new to the landscape of borrowing money. 

However, you do not have to do your research for the best money lender and make sense of it alone. 

There are business sites whose staff offer customer service advice on these topics about money and interest to ease their clients’ burden of looking for the best personal loan on their own. They are called loan comparison business sites and they are your best friends when you want to borrow a legal moneylender loan.

In Singapore, one of the best licensed moneylenders to pursue your business interest and money concerns is 365 Credit. 

They have an Orchard branch and have one of the most promising Google reviews from their past clients. 365 Credit aspires not just to help clients find the best financial plan that can solve their money issues. They also aspire to educate and make you understand the wonders of financial planning, and have years of business experience backing their advice.


There are a variety of legal loans you can avail of from a money lender where you can even get a personal loan for foreigners. The licensed money lender offers credit and loans with an interest rate that is legal and well-regulated in Singapore. 

Regardless of whether you want to take out a personal loan now or you will do it later, remember that it is crucial to borrow your credit money from a licensed money lender in Singapore. 

It may not seem much of a threat but there are lots of risks that you do not want to put yourself into if you do moneylending illegally. 

Get your legal money from the loan application portal of 365 Credit Pte Ltd and be safe and secured while you enjoy your opportunities from taking a leap forward on your financial decisions

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