There are times when you will need to borrow cash from a money lender. For example, when you need to buy a new car or pay off a large medical bill.
If you are in need of a loan, it is important to choose a money lender that is licensed by the Ministry of Law. Licensed moneylenders are regulated by the law and are restricted by the amount they can lend and the fees they can charge.
Licensed lenders are also required to be registered and to abide by the Moneylenders Act Singapore. This makes them a safer alternative to unlicensed moneylenders, otherwise known as loan sharks.
You can check if your money lender is licensed by checking the list on MinLaw’s website. There are currently 154 licensed moneylenders in Singapore, and none of them have been suspended so far.
Another key difference between licensed and unlicensed money lenders is the interest rates that they are allowed to charge. Licensed lenders can only charge 4% per month for both nominal interest and any late repayment interest.
Furthermore, they cannot charge any more than a 10% admin fee and a S$60 late payment fee. This is to prevent them from overcharging their customers.
It is a good idea to compare moneylenders before applying for a loan to find the best deal for your needs. This will ensure that you get the best loan terms and rates for your specific situation.
If you are facing financial difficulties and are unable to repay your moneylender, you should contact credit counselling services. They can help you negotiate with your moneylender and work out a repayment plan. They can also recommend other debt management solutions such as a debt consolidation loan or a loan forgiveness program. money lender singapore