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Getting a Personal Loan in Singapore

By Zack Diaz

Living in a fast paced way of living, sometimes you want to reward yourself for your hardwork with real things or services that are outside your everyday needs spending. Or you may need money for some pressure due to whatever reasons that crept up unexpectedly. If you actually need some extra cash for your vital wishes or for some indulgence, there are two avenues to get.

Banks are the standard source of getting financial loans. It was once that one can only have mastercards or facilities if one earns S$30,000 or even more annually. Lower income-earning folks can’t have access to any loan facilities at all, and many of them borrowed from illegal loansharks to that end. To let lower income earners have a way to borrow money although not from illegal loansharks, the Financial Authority of Singapore (MAS) decreased the minimum annual salary to S$20,000 for loan facilities.

With the revised Moneylenders Act in 2008, it is simpler to lend money now in Singapore for the lower income earners. Many borrowers are folks who earn less than S$30,000 every year, and some don't have good credit ratings. To serve this group of potential borrowers, many licensed moneylenders in Singapore have sprouted in the previous couple of years. And now getting a financial loan is easier and quicker as well.

A private loan is generally an unsecured loan, meaning you borrow money without any collateral fixed in position. Most, or even all, approved moneylenders in Singapore offer personal loans. Depending on your annual income, you can borrow up to a specific quantity, which may or may not be what you need to borrow.

If you earn less than S$20,000 per annum, you can only borrow up to S$3,000. However most licensed moneylenders will only extend up to S$1,000 credit to this group of borrowers. Some good points for this group are that their income and their credit ratings will not be verified, and the maximum interest chargeable is 18% per annum.

For folks earning between S$20,000 to S$30,000, you can borrowed up to twice your monthly salary. And for above S$30,000 income earners, the maximum amount you can borrow is 4 times your monthly salary. However there is not any cap on the chargeable interest, and a fair price for approved moneylenders in Singapore is 4% to 6% per monthly, which adds up to above 60% interest in a year! On top of this high interest, there are also approval/acceptance charges and some various fees charged by different licensed moneylenders. Though all these charges they are mandatory for licensed moneylenders to make public them in the contracts, along with late payment penalties, the calculation of interest and other charges.

Private loans from licensed moneylenders are better for the lower earnings and those with poor creditability. Typically the loan repayment period is anything from a month to six months. For folks who earn more, it's a smart move not to borrow from approved moneylenders, as the interest rates are high and not fixed, unless they borrow less than S$3,000. If possible, this group earning more than S$30,000 and with good creditability is much better off borrowing from banks with their lower interest rates and longer repayment period for higher loan amounts.

Zack Diaz is a website specialist, who has an abiding interest in Personal Loans. And the site he favours the most isPrivate Loans in Singapore.

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Article Citation
MLA Style Citation:
Diaz, Zack "Getting a Personal Loan in Singapore." Getting a Personal Loan in Singapore. 10 Apr. 2013. 27 Jul 2014 <>.

APA Style Citation:
Diaz, Z (2013, April 10). Getting a Personal Loan in Singapore. Retrieved July 27, 2014, from

Chicago Style Citation:
Diaz, Zack "Getting a Personal Loan in Singapore"

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