Before you borrow from a licensed moneylender in Singapore, it helps to know which of two kinds of loan you are looking at. A secured loan is backed by an asset you pledge as collateral, such as property. An unsecured loan does not need a specific asset to be pledged.
For loans from licensed moneylenders in Singapore, the biggest legal difference between the two is the borrowing limit. As of September 2026, unsecured loans are capped by your income, while secured loans have no borrowing cap. Licensed moneylenders are regulated by the Registry of Moneylenders under the Ministry of Law (MinLaw).
This article looks at how each type works, how much you can borrow, what each can cost, and what is at stake if repayments slip. It ends with three questions to help you decide which, if either, suits you.
How secured and unsecured loans work
A secured loan in Singapore requires you to pledge an asset, such as property, as collateral. The asset is the lender’s security: if the loan is not repaid, it can be repossessed and sold.
An unsecured loan works differently. It does not require a specific asset to be pledged, and approval rests on the lender’s assessment of your income, existing loan commitments and ability to repay. From licensed moneylenders, unsecured loans are limited by income-based caps, while secured loans have no borrowing cap.
One thing does not change between the two. As of September 2026, the same 4% monthly interest cap applies to both. The table below sets the two side by side.
Secured vs unsecured loans at a glance (as of September 2026)
| Secured loan | Unsecured loan | |
|---|---|---|
| Collateral | An asset, such as property, is pledged | No specific asset is pledged |
| Borrowing cap | No cap | S$500 to 6× monthly income, depending on income and residency, across all licensed moneylenders |
| Maximum interest | 4% per month | 4% per month |
| Maximum late interest | 4% per month, on the overdue amount only | 4% per month, on the overdue amount only |
| Maximum late fee | S$60 per month of late repayment | S$60 per month of late repayment |
| Maximum administrative fee | 10% of principal, when the loan is granted | 10% of principal, when the loan is granted |
| Total-charges cap | Interest, late interest, admin fee and late fees together cannot exceed the principal | Same |
| MLCB credit report | Checked before the loan is granted | Checked before the loan is granted |
| If the loan is not repaid | The pledged asset can be repossessed and sold | Late charges apply; the lender may make a court claim to recover the debt |
These figures apply to loans to individuals. Business loans are subject to separate provisions in the Moneylenders Rules.
Most rows are identical. The two loan types part ways on collateral, on the borrowing cap, and on what happens if the loan is not repaid, and those differences shape the rest of this article.
How much you can borrow without collateral
If you are considering an unsecured loan, the first thing to know is your cap. As of September 2026, the total you can owe in unsecured loans across all licensed moneylenders in Singapore combined depends on your annual income and residency status.
For Citizens and PRs earning below S$20,000 a year, the cap is S$3,000. For foreigners residing in Singapore, it is S$500 below S$10,000 and S$3,000 from S$10,000 to below S$20,000. At S$20,000 or more, the cap is six times monthly income for both groups. Secured loans have no cap.
| Annual income | Citizens and PRs | Foreigners residing in Singapore |
|---|---|---|
| Below S$10,000 | S$3,000 | S$500 |
| S$10,000 to below S$20,000 | S$3,000 | S$3,000 |
| S$20,000 or more | 6 × monthly income | 6 × monthly income |
Source: Registry of Moneylenders, as of September 2026. The tiers are set out in Rule 21 of the Moneylenders Rules 2009.
The cap is one combined total, not a separate allowance for each lender. Say your cap is S$3,000 and you already owe S$2,000 to one licensed moneylender. Another licensed moneylender could then lend you at most S$1,000 unsecured. Licensed moneylenders check this through the Moneylenders Credit Bureau (MLCB) before granting a loan.
In practice, the cap varies widely from one borrower to the next. As of September 2026:
- A Citizen earning S$3,500 a month (S$42,000 a year) has an unsecured cap of 6 × S$3,500 = S$21,000.
- A PR earning S$1,500 a month (S$18,000 a year) has a cap of S$3,000.
- A foreigner residing in Singapore earning S$800 a month (S$9,600 a year) has a cap of S$500.
If the amount you need is above your cap, a secured loan from a licensed moneylender may be an option, because secured loans have no cap. That extra room comes with a different kind of cost, covered in the sections that follow.
What each type of loan costs
It is easy to assume that pledging an asset buys you a cheaper loan. Under the law, it doesn’t. As of September 2026, licensed moneylenders in Singapore can charge at most 4% interest per month on both secured and unsecured loans, regardless of your income. Interest is calculated on the principal still owing after repayments.
The rate you are quoted depends on the lender’s assessment. So compare the terms you are actually offered rather than assuming one loan type costs less.
Interest is not the only charge, but the list of others is short. Apart from interest, the Registry of Moneylenders allows only these charges (as of September 2026):
- an administrative fee of up to 10% of the loan principal when the loan is granted
- late interest of up to 4% per month, only on the amount repaid late
- a late fee of up to S$60 for each month of late repayment
- legal costs ordered by a court for a successful recovery claim
Interest, late interest, the admin fee and late fees together can never exceed the loan principal. Court-ordered legal costs are separate from this cap.
Worked example: the legal maximum cost of a S$3,000 loan
These caps are easier to judge in dollars. This example assumes a S$3,000 loan repaid in three equal monthly principal instalments of S$1,000. Every repayment is on time, and the lender charges the legal maximum in each category. It shows legal ceilings as of September 2026. It is not a SuCredit quote or offer.
| Month | Principal owing | Interest (max 4%) | Repayment that month |
|---|---|---|---|
| 1 | S$3,000 | S$120 | S$1,120 |
| 2 | S$2,000 | S$80 | S$1,080 |
| 3 | S$1,000 | S$40 | S$1,040 |
- Total interest: S$240
- Maximum admin fee: S$300 (10% of S$3,000)
- Maximum charges if every repayment is on time: S$540
- Absolute ceiling, even with late charges: S$3,000
Because interest falls as the principal is repaid, the monthly cost drops each month. A secured loan of the same size has the same legal ceilings. The difference is that an asset is at stake, which matters most if repayments fall behind.
What is at stake if you can’t repay
The cost of a missed repayment starts the same way for both loan types. If you repay late, licensed moneylenders in Singapore can charge late interest of up to 4% per month on the overdue amount only. They can also charge a late fee of up to S$60 for each month of late repayment, as of September 2026.
Beyond that, the two loan types diverge. With a secured loan, the pledged asset can also be repossessed and sold if the loan is not repaid. With either type, the lender may make a court claim to recover the debt.
Security over property needs particular care. The Registry of Moneylenders warns that a caveat over the sale proceeds of a property can stop you from selling it until the debt is repaid. Read the security terms before you sign.
If repayments are becoming difficult, speak to the lender early. The Registry of Moneylenders lists debt-help organisations that can assist: Adullam Life Counselling, the Association of Muslim Professionals (AMP), Arise2Care Community Services, Blessed Grace Social Services, Credit Counselling Singapore, One Hope Centre and Silver Lining Community Services. Current contact details are in the Registry’s borrower FAQ.
Rules every licensed moneylender must follow
Whichever type of loan you choose, the same borrower protections apply. Licensed moneylenders in Singapore are regulated by the Registry of Moneylenders under the Ministry of Law, not by the Monetary Authority of Singapore (MAS).
Under the Moneylenders Act and Moneylenders Rules, a licensed moneylender must explain the loan terms in a language you understand. It must also give you a copy of the Note of Contract, issue a receipt for every repayment, and send a statement of account at least once every January and July.
A licensed moneylender must also check your MLCB record before granting any loan, including a secured loan. It must not keep your NRIC or other personal ID documents, and must not ask for passwords such as your SingPass login.
You can confirm that a moneylender is licensed on the Ministry of Law’s list of licensed moneylenders. The Registry of Moneylenders hotline is 1800-2255-529. To report unlicensed moneylending, call the Police X-Ah-Long hotline on 1800-924-5664.
Choosing between a secured and an unsecured loan
With the rules and costs in view, the choice comes down to how much you need, what you can repay, and whether you are prepared to pledge an asset. As of September 2026, the legal interest cap is 4% per month for both, so the real trade-offs are the borrowing limit and the collateral at stake.
Work through these questions in order:
- Can you repay comfortably from your regular income? If not, borrowing may make things harder. Consider speaking to a debt-help organisation first.
- Is the amount within your unsecured cap, after counting what you already owe? An unsecured loan does not require a specific asset to be pledged as collateral.
- Do you need more than your cap? A secured loan from a licensed moneylender has no borrowing cap. But the asset you pledge can be repossessed and sold if you do not repay.
Borrow responsibly. Borrow only what you need and can repay on time from your regular income. Read every term before you sign, and ask the lender to explain anything unclear. If you want to stop yourself from taking new unsecured loans, you can apply for self-exclusion through the MLCB. It lasts one or two years for Citizens and PRs, with a default minimum of two years for foreigners.
Frequently asked questions
Does the unsecured borrowing cap apply to each moneylender or to all moneylenders combined?
The unsecured borrowing cap in Singapore applies to all licensed moneylenders combined, not to each one separately. As of September 2026, the combined cap for Citizens and PRs is S$3,000 if annual income is below S$20,000, or six times monthly income at S$20,000 or more. Licensed moneylenders check existing loans through the MLCB.
Can foreigners on a work pass borrow from a licensed moneylender in Singapore?
Foreigners residing in Singapore can apply for loans from licensed moneylenders, with approval subject to the lender’s assessment. As of September 2026, their unsecured cap is S$500 below S$10,000 annual income, S$3,000 from S$10,000 to below S$20,000, and six times monthly income at S$20,000 or more. Ask the lender which types of passes it accepts.
Can self-employed people, private-hire drivers or delivery riders get an unsecured loan?
Self-employed people, private-hire drivers and delivery riders in Singapore can apply for an unsecured loan from a licensed moneylender. Approval is subject to the lender’s assessment of their income, existing loan commitments, and ability to repay. As of September 2026, the unsecured caps depend on annual income and residency status, not type of work. Ask the lender which proof of income it accepts.
If I’ve joined MLCB self-exclusion, can I still take a secured loan?
MLCB self-exclusion prevents new unsecured loans from licensed moneylenders in Singapore, except debt consolidation loans. As of September 2026, it lasts one or two years for Citizens and PRs, with a default minimum of two years for foreigners. The legal restriction covers unsecured loans, so think carefully before using a secured loan to borrow around your own exclusion.
What documents do I need to apply?
Licensed moneylenders in Singapore ask for documents that show your identity, income, and address. Examples include payslips, tax statements, CPF contribution history, or a utility bill. The exact list depends on the lender and the loan type. A licensed moneylender must not keep your NRIC or other ID documents, or ask for your SingPass password.
Will applying affect my credit record?
Licensed moneylenders in Singapore check your Moneylenders Credit Bureau (MLCB) record before granting a loan. The MLCB records borrowing and repayment information, and pending unsecured loan applications can also appear in the report. The MLCB is separate from bank credit records and does not collect your bank credit-facility data.
Are there hidden fees on moneylender loans?
As of September 2026, licensed moneylenders in Singapore may charge only five items. These are interest and late interest (each capped at 4% per month), a late fee of up to S$60 per month, an administrative fee of up to 10% of principal, and court-ordered legal costs. Excluding legal costs, total charges can never exceed the principal.
Can I cancel an unsecured loan after taking it?
Yes. Since 15 September 2026, borrowers can cancel an unsecured loan from a licensed moneylender in Singapore, other than a business loan, within three business days of disbursement. Statutory rules govern what you must repay and what the lender may keep. Ask the lender to explain how cancellation works before you sign.
Not sure which suits you? Talk to our team.
SU CREDIT PTE. LTD.
Licensed by the Ministry of Law’s Registrar of Moneylenders (Licence No. 114/2026)
175 Bencoolen Street, #01-36, Burlington Square, Singapore 189649 · 6636 5644
You can verify any moneylender’s licence on the Ministry of Law’s list of licensed moneylenders.
Sources
- Registry of Moneylenders, FAQs on Borrowing From Licensed Moneylenders
- Registry of Moneylenders, List of Licensed Moneylenders in Singapore
- Moneylenders Act 2008 and Moneylenders Rules 2009, Singapore Statutes Online
- MoneySense, Understand the types of loans
- Moneylenders Credit Bureau