There is no denying that many of us will need loans at some time in our lives. But deciding which loans to take and from whom might be a challenging decision.
The most obvious option that comes to people’s minds is a bank loan. However, several people face trouble getting a loan from a government-authorized bank. It could be because of poor creditworthiness, red-tapism, or anything else.
The best approach in this situation might be to contact a private Singapore moneylender. Depending on your needs or the purpose of the loan, licensed money lenders offer a variety of loan options.
We’ll go over a few points in this blog post that you should be aware of before you apply for a loan from a licensed money lender in Singapore.
How Can You Find a Licenced Money Lender In Singapore?
Taking loans in emergency cases is no more an uncommon scenario. We frequently turn to money lenders in difficult circumstances as an easier, more feasible option to borrow money.
It’s true: when you need a quick loan, a licensed Singapore money lender can save your life. Unfortunately, the illegal business of loan sharks masquerading as money lenders has expanded quickly in recent years. These loan sharks are infamous for their harsh business tactics, which include threatening borrowers and charging high-interest rates.
Hence, if you’re looking for a loan from a lender, you need to understand the distinction between a legitimate money lender and a loan shark. You may learn who to trust and who to be on the watch for by using the following seven guidelines –
1. Licensed Money Lenders Require You to Sign a Contract
According to the law, each borrower must attach their signature to a document binding them to the lender. The loan’s terms should be made clear in the contract form. For instance, it needs to include information on the loan’s tenure, amount, interest rate, and processing charge, if any.
Avoid working with a lender if they offer blank papers for signing as the contract document or if they don’t offer any contracts. It is a sure sign that they are not doing business legally.
2. Licensed Lenders Cannot Charge Interest Rates Above the Market Standards
Beginning on October 1st, 2015, the government set the maximum interest rate limit to 4% per month. A legitimate loan provider won’t charge an interest rate higher than 4%.
On the other hand, loan sharks frequently charge higher rates. Hence, choose a lender with caution. It’s better to run away if you ever receive an offer with an interest rate of more than 4%.
3. Licensed Lenders Are Listed on the Ministry of Law Website
On the website of the Singapore Ministry of Law, all licensed money lenders are listed. Check the website to see if the money lender is listed if you are in contact with them. If they aren’t, they’re probably loan sharks.
You may read the Money lenders Registry maintained by the Ministry of Law here.
If a licensed lender just got their license and the website hasn’t been updated with their information, they might not be included. Call the ministry at 1800 2255 529 if you think this is the case.
4. Licensed Lenders Will Always Have a Physical Location
If a lender makes you an offer but does not have a physical office, do not assume it to be legitimate. According to the law of Singapore, all licensed lenders must have offices that are listed on the Ministry of Law website.
Ideally, licensed lenders conduct the majority of their operations from offices. Unlicensed money lenders typically don’t have offices, or if they do, they don’t correspond to the ones listed on the Singapore Ministry of Law website.
5. Loan Sharks Frequently Use Threats and Abusive Language
One of the obvious signals that you’re dealing with a loan shark is the use of aggressive language and threats.
Before you choose to borrow money from a loan shark in Singapore, you may experience various threats and harassment. These actions will undoubtedly continue once you have done so.
If you do not make repayments on time, they may continue to use scare tactics to get their money and perhaps harm you.
There has been an increase in incidents of harassment by loan sharks in Singapore as unlicensed money lenders are going digital. Take extra caution when you’re browsing for moneylenders online.
6. Licensed Lenders Will Always Protect Your Personal Information
To guarantee that they have enough information to terrify you with or for future marketing objectives, loan sharks will always try to obtain as much information from you as possible. They frequently use your SingPass login information, and you never know what cunning plan they’ll come up with to reach you. However, when you are applying for a loan from a licensed Singapore money lender, they will only access your SingPass account in your presence to check your income.
7. Licensed Moneylenders Obey the Law With Advertising Regulations
The Registry of Money Lenders has announced new guidelines that demonstrate the commercial and marketing criteria. These guidelines apply to authorized money lenders. The maximum fine for breaking the law by utilizing illegal media is $20,000, and the license may also be suspended. However, only these three paths are permitted for this:
- Business or consumer directories in print or online publications
- The licensed money lender’s official website
- Postings of advertisements inside the premises of the money lender’s office
If you receive promotional texts or ads from moneylenders, they are probably loan sharks. Stay wary of such advertisements.
Singapore has a prevalent loan shark presence. Therefore, you must screen the lenders closely.
Moreover, while there are many licensed Singapore moneylenders, not all offer the same level of service. SU Credit is an authorized money lender offering top-notch customer support. With our wide experience, we have given affordable loans to hundreds of customers. Our loan agents ensure a seamless, quick loan approval process.Submit your details with us and get a quote today.