Licensed Money Lender Singapore

Guide to Taking a Loan From a Licensed Money Lender Singapore

Filife Team

    Living in a foreign country – whether it’s for school, work, or family, can be an exciting yet overwhelming experience. It becomes especially challenging when an emergency strikes and your finances take a hit. So who do you turn to when you need financial assistance?

    Taking up a personal loan for foreigners can help when you’re facing financial difficulties. Thankfully, Singapore has traditional bank personal loan options for foreigners. But what if you don’t qualify for bank loans? You can always turn to licensed money lenders.

    Licensed money lenders in Singapore are regulated and authorized by the Ministry of Law Singapore. These lenders offer customizable loan packages for both locals and foreigners living in Singapore. They have a less stringent application process so your request is often approved within the same day.

    If you are looking to borrow money from a licensed money lender, you must understand your rights and responsibilities under the Moneylenders Act.

    What Is the Moneylenders Act?

    The Moneylenders Act Singapore was first introduced in 2008 to protect both the borrowers and moneylenders in Singapore. The Act states how the moneylending business must be conducted. It also details how licensed moneylenders must collect, use, and disclose borrower information and data.

    The Moneylenders Act Singapore also states the cap on interest rates, permitted fees, and the maximum loan amount based on the borrower’s income. Essentially, it protects borrowers from getting into debt with illegal or unlicensed money lenders who often charge unfairly high interest rates and fees.

    Understanding the Moneylenders Act will help you make an informed decision when taking out a loan.

    Who Are Allowed To Lend in Singapore

    The Moneylenders Act Singapore has defined the parties allowed to provide money lending services in the country.

    According to the Act, entities that can legally lend money are:

    • Exempt money lenders: Those who have been granted an exemption from holding a license
    • Excluded money lenders: Those who are authorized to lend money under another law, such as pawnbrokers under the Pawnbrokers Act.
    • Licensed money lenders: Those who have been granted a license by the Registry of Moneylenders under the Moneylenders Act Singapore.

    How the Act Protects Customers

    • Ensures that you’re borrowing from licensed money lenders. Borrow only from legal lenders that are regulated by the authorities to avoid loan scams.
    • Check if you are dealing with a licensed money lender. Check out the complete list of licensed money lenders in Singapore at the Ministry of Law’s website.
    • You are prevented from taking on too much debt. The Act sets specific limits on how much you can borrow from a licensed moneylender based on your income.
    • Money lenders are prevented from overcharging you in fees and interests. For instance, the interest rate that licensed money lenders can charge is capped at 4% per month.

    Loan Features

    1. Loan Amount

    For secured loans, you can borrow any amount. However, there are limits to how much you can borrow for unsecured personal loans. Take a look at the table below:

    Borrower’s annual income

    Singapore Citizens and Permanent Residents

    Foreigners residing in Singapore

    Less than $10,000



    At least $10,000 and less than $20,000


    At least $20,000

    6 times monthly income

    6 times monthly income

    If you’re a foreigner living in Singapore, you can borrow up to 6x your monthly income if you earn at least S$20,000. If you earn less than S$10,000, you can only borrow up to S$500. For an income of at least S$10,000 but less than S$20,000, you can borrow up to S$3,000.

    2. Interest

    Licensed money lenders can only charge an interest rate of up to 4% per month. This cap applies regardless of your nationality, income, or whether the loan is secured or unsecured.

    3. Charges and Fees

    Aside from the interest rate, licensed money lenders are also permitted to charge a late interest of 4% per month for each month the loan is repaid late. Other fees that licensed lenders can impose include:

    • Late repayment fee of up to S$60
    • Administrative fee of not more than 10% of the principal loan amount when the loan is granted
    • Legal costs ordered by the court for a successful claim by the moneylender for the recovery of the loan

    4. Tenure

    Foreigners in Singapore can borrow a personal loan with a 12-month tenure. However, this may still be subject to the terms and conditions of the loan agreement with the licensed money lender.

    Businessman handshake after discussing good deal contract

    How To Avoid Scams

    Since January 2022, the Police have received at least 15 loan scam reports with losses amounting to more than S$20,000. This is according to the police advisory by Singapore Police Force.

    As a foreigner living in Singapore, you need to be extra careful in dealing with money lenders. You must stay vigilant and beware of loan sharks who may approach you with tempting loan offers.

    Here are a few reminders:

    • Licensed money lenders are prohibited from soliciting loans via SMS, phone calls, emails, or social media platforms.
    • Legal lenders will never ask you to make any payment, such as processing fee, loan approval fee, or other fees before the loan can be disbursed.
    • Licensed lenders will not request Singpass or bank login details to facilitate loan approvals.
    • A loan officer must meet you in person at the approved place of business to conduct face-to-face identity verification.
    • Lastly, legal lenders must provide you with a loan contract listing all the terms and conditions of the loan.

    Here are a few ways to stay safe:

    • Ignore any unsolicited loan ads and do not reply to any of these messages. Instead, block and report the number as spam.
    • Seek financial assistance from legitimate financial institutions. Make sure that the licensed money lender is registered with the Registry of Moneylenders. You can find the complete list of licensed moneylenders on the Ministry of Law’s website.
    • Do not send any money.
    • Never share your personal information such as your passport, Singpass ID and password, and OTP with anyone.
    • Beware of fake websites. Loan sharks may create fake websites to convince you of their legitimacy. Check the authenticity of the money lender’s website through MinLaw’s website.

    It is best to always stay vigilant against potential loan scams. Loan sharks constantly change their tactics to avoid detection. If you have any information on such scams, immediately call the Police Hotline at 1800-255-0000 or submit information online at

    You can also lodge a complaint against a moneylender for unfair practices. Simply contact the Registry at 1800-2255-529. Rest assured that all information is kept strictly confidential.

    Factors To Consider When Choosing a Loan

    In Singapore, you will never run out of options when you need financial assistance. However, before borrowing, there are a few things you need to keep in mind. First, consider your responsibilities as a borrower.

    1. Have You Considered Other Alternatives?

    Before you start shopping for loan plans with a licensed money lender, consider alternatives. For instance, you can look into financial assistance schemes offered by Government agencies. You may contact these agencies to find out if there are schemes available for you.

    2. Ask What Types of Loans Are Available

    Licensed money lenders offer different types of loans, including personal loans for locals and foreigners, payday loans, business loans, bridging loans, and more.

    If you’re a foreigner seeking financial assistance, you may take up a foreigner loan. This is similar to a personal loan where you can borrow up to 6x your monthly income. However, the eligibility requirements and documents may vary from personal loans available for locals.

    3. Check The Interest Rates and Fees

    As previously mentioned, licensed money lenders are only permitted to impose the following fees:

    • Monthly interest rate up to 4%.
    • Late interest rate of up to 4% for each month the loan is repaid late
    • Maximum of S$60 late fee
    • Up to 10% administrative fee when the loan is granted

    If the money lender charges fees exceeding the cap set by the Registry of Moneylenders, it’s time to walk away. You may be dealing with a loan shark.

    4. Check Reviews

    On top of checking the credibility and license of the money lender, you must also read customer feedback and reviews. Doing so will help you determine whether the money lender is fit for you. You can read reviews on Google Reviews, money lender forums, or credible loan comparison websites.

    Singapore currency - dollars and cents closeup

    Step-by-Step Guide on How To Borrow From a Loan From Licensed Moneylenders

    Just like any financial institution, legal money lenders need to evaluate and process your loan application accordingly. They cannot reject your application without any grounds. Additionally, you must be informed whether your application was approved or not.

    Here’s how to apply for a loan:

    Check Your Eligibility

    • You must be at least 18 years old
    • You must meet the minimum income requirement
      • Singaporeans or permanent residents must earn at least S$1,500 per month
      • Foreigners must earn at least S$2,000 per month

    Ready The Necessary Documents

    For Singaporean and Permanent Residents

    • A copy of your NRIC (front and back)
    • Proof of residency, such as utility bills
    • Proof of income, such as the latest 3 months payslip
    • SingPass to log into the CPF, HDB, IRAS website

    For Foreigners

    • A copy of your passport
    • Work Permit, S Pass, and Epass
    • Proof of residency, such as tenancy agreement
    • Latest 3 months payslip
    • SingPass to log into the IRAS website

    Shop for Options

    Before sending your application to the first legal money lender you come across, it is best to first compare loan plans. Note that multiple hard inquiries can affect your credit score. That said, you can use online loan comparison platforms to find the best loan terms from the top licensed money lenders.

    Follow The Loan Application Process

    Once you’ve chosen the loan package that best suits your needs and repayment capability, you can take out a loan in three easy steps:

    • Call or apply online. You can now apply from the comfort of your home 24/7.
    • Visit the money lender’s office. A loan officer will set an appointment date where they can explain the details of the loan. Make sure that the loan plan will fit your current financial situations
    • Finalize your loan plan. You must completely understand the terms of the loan before signing the loan contract. You will receive your funds as fast as within the hour.

    Tips When Taking a Loan

    When you’re unable to meet the strict requirements of banks, you can consider borrowing from a licensed money lender. Although these lenders will still evaluate your loan application, they have less stringent processes. This may include a lower minimum income requirement as well as less scrutiny of your credit history.

    Consider these tips when taking up a loan from a licensed money lender:

    • Make sure you’re dealing with a licensed lender: This advice may sound like a broken record, but it bears repeating. Check the complete list of licensed moneylenders and make sure that the lender is not blacklisted.
    • Double check the loan contract before signing: The loan contract must be filled in completely and have all the correct details.
    • Have a repayment plan: The legal money lender will provide you with a repayment schedule. This will help you keep track of your repayments and set aside a budget. Creating a budget will help you take control of your finances.
    • Pay on time: Never miss payments. Once you have created a budget, ensure that you can make the payments on time. Failing to repay your loan can lead to late fees and late interest.

    To help you stay on track, you can set up an automated payment system with your internet banking account– just make sure that your account has enough balance.

    • Keep all the necessary documents: The money lender will issue a receipt for every repayment towards the loan. Check it for correctness. Lastly, make sure to keep all the receipts and statements of account for all your loan(s).
    • Have a debt consolidation plan: If you have multiple loans, you may want to consolidate them. Debt consolidation plans make repayment easier because you’ll only have to keep track of one repayment schedule.
    Book titiled FAQ with a question mark

    Frequently Asked Questions

    1. What Is Excluded Moneylender?

    An excluded moneylender is authorized to lend money under another law. For instance, credit societies can lend money under the Co-Operative Societies Act. Pawnbrokers are also allowed to lend money to borrowers under the Pawnbrokers Act.

    2. What Is Exempted Moneylender?

    Exempt moneylenders are those who have been granted exemption from holding a moneylender’s license based on the discretion of the Singapore government. The lender must apply for a certificate of exemption and it is subject to approval as provided under the law.

    3. Can a Moneylender Be Called a Banker?

    The short answer is no. Although money lenders and bankers are synonymous, they have different functions.

    Banking is a business that is different from a business that exclusively deals with money lending. Money can be safely kept at a bank where clients can access loans, investments, and other services. 

    A licensed money lender, on the other hand, can only provide loans, such as personal loans, foreigner loans, and payday loans.

    4. What Is the Maximum Interest Rate Money Lenders Can Charge in Singapore?

    Effective 1 October 2015, the maximum interest rate that money lenders can charge is 4% per month. This cap applies regardless of the borrower’s income and whether it is an unsecured loan or a secure loan.

    5. Is It Safe To Borrow From A Licensed Money Lender?

    Yes, it is. All licensed lenders in Singapore are governed by the Ministry of Law. They are fully compliant with the Moneylenders Act.

    Before dealing with any money lender, verify their license via the Ministry of Law’s website.

    6. How Can I Tell if the Advertisement Is From a Licensed Money Lender?

    Licensed money lenders will never send unsolicited SMS, emails, flyers, or other forms of advertisements. These are prohibited under the advertising rules. Licensed lenders can only advertise through three channels:

    • Business or consumer directories – both in print or online media
    • Business websites of the moneylender
    • Advertisements placed within or on the exterior of the moneylender’s place of business.

    7. What if I Can’t Repay the Loan?

    When you fail to make loan payments, the interest will keep accruing. Your loan will eventually snowball, making it harder for you to pay off the total amount of the loan.

    On top of that, your credit score will also take a hit. Defaulting on a loan or late repayments can lead to a lower credit score. This means you’ll have a harder time getting loans in the future.

    If you can’t repay your loan, you can consider the following options:

    • Reach out to your lender and negotiate for a loan extension. Most legal lenders can help restructure your loan for easier repayments.
    • If you have a hard time managing your financial loan, you can seek help from social service agencies. 

    8. Are There Red Flags I Should Watch Out For?

    Even if you’re borrowing from a legal money lender, you must still be mindful if they:

    • Use abusive language or behave in a threatening manner towards you.
    • Ask for your Singpass user ID and password
    • Refuse to give back your NRIC card or other personal identification documents, such as a passport, work permit, or driver’s license.
    • Ask you to sign a blank or incomplete loan contract.
    • Ask for payment before the loan is disbursed.
    • Grant you a loan without performing due diligence. This means you did not meet face-to-face with a loan officer.
    • Fail to properly explain the terms and conditions of the loan.
    • Withhold any or part of your principal loan amount.

    9. What Should I Do if a Money Lender Is Harassing or Threatening Me?

    If a licensed lender uses intimidation, harassment, violence, or damages to your property, you must:

    •  Immediately contact the police. Here are the numbers you should keep in mind:
    • File a complaint with the Registry of Moneylenders. Rest assured that all information will not be disclosed without your consent.
    • Pursue the matter through the Small Claims Tribunal or the Court under the Consumer Protection Act.

    10. What Types of Loans Are Available?

    Licensed money lenders offer different types of unsecured loans. These loans have different eligibility criteria as well as maximum loan amount and tenure.

    • Personal loans: The funds may be used for a variety of purposes, such as home renovation, medical bills, or paying off credit card bills.
    • Foreigner loans: This is a type of personal loan available to foreigners. It can be used to pay off rental deposits or used as an emergency fund.
    • Payday loans: This is a fast cash loan that allows borrowers to get up to one month’s worth of salary. It needs to be paid within a month or when you receive your salary.
    • Bridging loans: This type of loan may be used to fund a new property or bridge the financial gap while waiting for the sales proceeds of your old property. You can borrow up to 6x your monthly income with flexible repayment terms.
    • Business loans: Business owners can use this loan to pay off rental down payment or purchase additional inventory or equipment to run their business.


    If you’re a foreigner in Singapore who is facing financial difficulties, you have nothing to worry about. There is financial assistance just within your reach. Licensed moneylenders can be a viable alternative when traditional bank loans just aren’t an option.

    Key Takeaways:

    • Before borrowing money from a licensed moneylender, you must understand your rights and responsibilities under the Moneylenders Act.
    • The Moneylenders Act Singapore aims to protect both the borrowers and moneylenders in Singapore.
    • The Act details the cap on interest rates, permitted fees, and the maximum loan amount based on the borrower’s income.
    • Stay vigilant against potential loan scams, so be sure to approach only licensed money lenders in Singapore for your financial needs.

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