When the situation calls for it, you may find yourself needing some extra cash to pay off an emergency medical bill or urgent home expenses. But without sufficient funds on hand, how can you pay for these?
While there are options such as borrowing from family and friends, you can also turn to legal money lenders for a personal loan. Reading money lender reviews in Singapore can also help you understand other borrowers’ experiences and identify lenders worth considering.
However, as a first-time borrower, you might not know where to start or how to check if a money lender is licensed. Don’t fret; we’ll be sharing invaluable tips with you on how to check licensed money lender reviews and verify a lender’s credentials before applying for loans.
What are licensed money lenders?
The Moneylenders Act defines a money lender as a person, be it a principal or agent, who provides the business of moneylending. Under Singapore law, no individuals are allowed to be a money lender unless they are registered and approved with a licence, or they are “excluded or exempt money lenders” as detailed under the Moneylenders Act.
Essentially, licensed lenders are people or businesses who are recognised by the Singapore government to provide legal loan services to borrowers. Being a licensed business means that they will have to abide by the rules and regulations (e.g. maximum interest rate, late payment fees) set by the law.
Why check licensed money lender reviews before applying for loans?
Numerous money lenders provide various loans with attractive rates and terms to suit different needs. But when it comes to understanding if a lender is trustworthy, helpful and professional, the best money lender reviews can help ease the search.
It is important that you first research the different kinds of loans available before making a choice. For example, if you need cash to pay for your home renovation down payment, should you take up a fast cash loan or an actual home renovation loan?
Once you have identified the specific loan needed, you can then compare across the different money lenders using these factors:
#1 Eligibility
Singaporeans and PRs have different loan eligibility requirements as compared to foreigners.
The minimum age to apply for a personal loan can vary between licensed money lenders. While some lenders require borrowers to be at least 21 years old, others, such as Goldstar Credit, accept applicants aged 18 and above, subject to eligibility requirements. Your salary also determines the maximum amount that you can borrow from all licensed money lenders in Singapore.
Refer to the table below to find out how much you can borrow across licensed lenders at any one point in time, based on your residency status and income level:
| Borrower’s annual income | Singapore Citizens and Permanent Residents | Foreigners residing in Singapore |
| Less than S$10,000 | S$3,000 | S$500 |
| At least S$10,000 and less than S$20,000 | S$3,000 | S$3,000 |
| At least S$20,000 | Six times monthly income | Six times monthly income |
#2 Interest rates, fees, and repayment options
Before applying for a loan, determine how much money you need. Sure, different lenders offer attractive borrowing sums of up to six months of your monthly income. However, the more money you borrow, the more interest and fees you have to pay.
Money lenders in Singapore are allowed to charge a maximum interest rate of 4% per month regardless of how much you earn or if your loan is a secured or unsecured one.
Late interest is also capped at 4% per month, but it can only be charged on the overdue principal amount and not the entire outstanding balance.
Licensed money lenders may also charge certain fees, subject to the applicable limits:
- Administrative fee: Up to 10% of the principal amount when the loan is granted. This fee is deducted from the loan principal and should not be collected upfront from the borrower.
- Late fee: Up to S$60 for each month of late repayment.
- Overall cap: The total amount of interest, late interest, administrative fees and late fees charged cannot exceed 100% of the original loan principal.
Be wary of companies that charge higher interest rates or fees beyond the permitted limits, as they might be loan sharks operating outside the rules governing licensed money lenders.
Legal lenders also offer flexible loan repayments. Some may require you to pay monthly instalments, while others may offer borrowers bi-weekly or weekly repayments to suit various circumstances and preferences.
Types of advertisement that differentiate licensed lenders from loan sharks
Under the law, legal lenders are only allowed to advertise through these three methods:
- Business or consumer directories online, or in print media such as newspapers or magazines.
- The legal money lenders’ registered websites.
- Advertisements placed within or on the exterior of their physical office premises.
Hence, do not respond to any unsolicited advertisements in the form of SMSes, flyers, and social media messages, or calls. Any form of advertisement not mentioned above is not permitted and is from either licensed lenders who violate state laws, unlicensed lenders, or scammers.
Always consult the list of licensed lenders in Singapore
While Singapore’s money lender reviews can provide useful insights, legal money lender reviews alone should not determine whether a lender is legitimate. Always verify the lender against the Registry of Moneylenders first.
Legal lenders are required by law to be listed on the Ministry of Law’s Registry of Moneylenders. The document details the business name, physical address, licence number, contact numbers, and websites belonging to the business.
There have been recent cases where loan sharks are posing as legal lenders and using their registered business names to trick unsuspecting borrowers.
Remember to always call the listed business number and visit the physical office to verify. All licensed lenders are required to have an office, which you will be required to visit for a mandatory face-to-face verification before loan disbursement.
Most unlicensed lenders work remotely and might approve your loan application without ever meeting in person or doing any proper credit assessment.
Illegal behaviours to watch out for
Legal lenders will not ask you for your Singpass username and/or password. They will not keep your original NRIC or any other personal documents, or ask you to sign an incomplete contract for the loan.
Be cautious when a lender starts to use abusive language or threaten you to pay up. Examples of unacceptable behaviours include excessive SMSes or calls, contacting you during unusual hours, making repeated calls to your home or office, causing distress to your family or colleagues, or loitering around your home or office.
If you experience any of these licensed money lender harassment tactics, report the lender to the police immediately.
Licensed money lender reviews: Where to look for them and what to look out for?
Loan comparison sites
Loan comparison sites can be useful when researching legal money lender reviews. Check the list of licensed lenders in Singapore and compare the minimum requirements, interest rates, fees, and repayment methods offered by the lenders.
However, do make sure that the information is current, particularly when comparing interest rates, fees and eligibility requirements.
Online reviews
Online money lender reviews in Singapore can give you an idea of how previous borrowers felt about a lender’s service, communication and overall experience. When reading a Singapore money lender review, look for recurring comments across multiple reviews rather than relying on a single customer’s experience. You can do so on Google Reviews, or on various loan comparison websites or social media where past customers provide reviews about their experience dealing with the licensed lenders.
Keep in mind that money lender reviews in Singapore do not replace the need to verify a lender’s licence and loan terms.
On the licensed lenders’ official websites
The official website of a money lender will usually state its licence number and physical address, which you can cross-check with the Registry of Moneylenders’ list of registered lenders. On the website, you’ll typically also find customer testimonials or the best money lender reviews from customers who have borrowed from the lender. Based on their account, you can get a gist of their experiences dealing with the money lender.
That said, reviews published on a lender’s own website may be curated, so it is worth comparing them with independent money lender reviews on platforms such as Google.
What should you do next?
After verifying the legal money lender’s reviews, enquire about their loans by visiting the money lender’s office or speaking with their agents online or through a phone call. By law, they’re obliged to protect your privacy and keep your information confidential.
Before committing to any loan, make sure you receive a written contract and understand all of the terms outlined within.
Looking for a reliable licensed lender?
Apart from looking at licensed money lenders’ reviews, you’ll have to identify a legal lender that can best meet your financial needs. Goldstar Credit can help you find the right legal loan solution for your needs. With over a decade of experience, we have earned the highest number of positive reviews among money lenders in Hougang and Toa Payoh.
Contact us today with your financial requirements and our loan specialists will get back to you with personalised recommendations. Or if you’re ready to apply for a loan, simply do so on our secure website.
