There are many reasons why you might need money in a hurry. Medical emergencies, car repair bills or an unexpected house renovation can leave you strapped for cash. In such a situation, turning to a licensed money lender in Singapore might be your only option. It is important to choose a legitimate moneylender with good reputation and the right terms for your situation. This will help you avoid getting into debt or falling prey to loan sharks. You should also shop around to compare rates and find a deal that suits you best in the long run.
The Ministry of Law requires all money lenders in Singapore to be registered and abide by certain rules and regulations. This includes following a set of guidelines on interest rates and fees, ensuring that they are not predatory or engaging in illegal practices. If you encounter a money lender that does not follow these standards, it is advisable to report them to the Registry of Moneylenders.
Licensed money lenders in Singapore are allowed to advertise their services via business and consumer directories, their websites and advertisements displayed within or on their office premises. However, they are not permitted to solicit for loans through text messages, social media platforms or over the phone. So, if you receive any offers through these channels, be wary as they are most likely from unlicensed money lenders and may be breaking the law.
A licensed money lender in Singapore must provide you with a clear and concise written contract that details all the terms of the loan including the loan amount, the interest rates, the permitted fees, the date of the loan disbursement and the calculation of the late interest fee. Additionally, they are required to check your credit history with the credit bureau before granting you the loan. Therefore, it is best to always check your credit score on a regular basis and minimise the number of times you take out loans with banks in order to keep your interest rate low and prevent your debts from spiralling out of control.
It is important to note that the maximum loan term for a legalised moneylender in Singapore is 12 months. Moreover, the maximum amount of principal loan plus interest charged is limited to 3 times your monthly income. This allows you to manage your cash flow better and pay off the loan quickly in a shorter period of time.
A licensed money lender will not ask you for your SingPass user ID and password or any personal information that can be used to commit identity theft. You should never give out your SingPass details to any individual unless you have been instructed by the authorities. It is also advisable to retain your statements of accounts and receipts from your loan repayments as proof of payment. Lastly, beware of moneylenders that require you to sign an incomplete loan contract or are asking for your original documents. This is a red flag and could be a warning of a loan shark.