The Ministry of Law regulates licensed Moneylenders
This means that there are rules and regulations that Licensed Moneylenders must adhere to, and they can be penalized if they don’t.
For example, Licensed Moneylenders must adhere to a cap on the interest rates they can charge, and they’re not allowed to charge any fees whatsoever.
You Must Be at Least 21 Years Old
First, you must be at least 21 years old to apply for a loan. Secondly, you’ll need to provide some form of identification, such as your NRIC card keeping in mind that you’ll need proof of income and employment.
You Can Borrow Up to 4 Times Your Monthly Income
The government has established regulations to protect borrowers from over-borrowing and accruing excessive debt. So, licensed moneylenders are a great option if you require some quick cash.
The Interest Rate Is Capped at 4% Per Month.
Well, licensed money lenders are regulated by the government, which means that the interest rate is capped at 4% per month.
That’s much lower than the interest rates you’ll find at banks, which can be as high as 24% per annum.
Late Payment Fees Are Capped at $60
Late payment fees are capped at $60 so that as long as you pay your loan back within a month, you won’t have to worry about incurring any extra charges.
But if you cannot repay your loan on time, don’t hesitate to reach out to the moneylender. Most of them will work with you to create a repayment plan that fits your budget.
There Is No Early Repayment Fee
Many licensed moneylenders in Singapore don’t charge an early repayment fee. So if you find yourself in a situation where you can pay off your loan early, you can rest assured that you won’t be penalized for it.
You Can Prepay Your Loan Without Penalty
You can pay off your loan before it’s officially due, and you won’t be charged any extra fees.
Being a great option if you come into some extra cash or want to get ahead of your payments. It’s also a good way to reduce the overall interest you’ll end up paying.
Licensed Moneylenders Cannot Offer Loans to Students.
The authorities strictly regulate licensed moneylenders and cannot offer student loans.
They can only offer loans to Singaporeans with a valid work permit or citizenship, and they must disclose the full terms and conditions of the loan before issuing it.
Licensed Moneylenders Cannot Offer Loans to Foreigners.
Firstly, moneylenders need to be aware of their borrowers’ credit history and financial situation, and they simply don’t have the same level of access to information when it comes to foreign borrowers.
Secondly, there’s the issue of regulation. The Ministry of Law regulates moneylenders in Singapore, and the rules around lending to foreigners protect both the lenders and the borrowers.
You Can File a Complaint With the Ministry
If you have a problem with a licensed moneylender, you can file a complaint with the Ministry of Law. The Ministry of Law will review your complaint and take appropriate action.