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Licensed Moneylenders Singapore Has & Why They’re Different From Loan Sharks

Annette Anthony

Annette Anthony

Last updated 29 June, 2022

If you’re looking for a personal loan, you could either approach a bank or a moneylender Singapore has. That said, how do you differentiate between loan sharks and licensed moneylenders?

As a potential borrower, you would not want to owe money to unlicensed moneylenders. Here are two major risks you open yourself up to when you approach them for a loan: 

  1. You may unknowingly expose your private information to a scammer
  2. You may be at the mercy of relentless loan sharks who barrage you with high interest rates and dirty tactics to enforce repayments

These perpetrators may approach you in various ways – fishy websites, social media accounts, SMS messaging, or phone calls. In fact, they might even ask you to visit a non-business location to talk about your loan. 

These aren’t the usual practices of licenced moneylenders, so it’s important to take note of these red flags. 

Table of contents


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How to verify a licensed moneylender?

How do you verify if you’re dealing with a licensed moneylender?  Firstly, any licenced moneylender Singapore has can only contact you in person.

  1. They need to:
    1.  Meet you at an approved business location in person
    2.  Conduct a face-to-face meeting with you for physical verification
  2. They cannot:
    1. Solicit for loans through phone calls, texts, or on social media platforms
    2. Perform all loan transactions online

Before visiting a moneylender website, check this list of licensed moneylenders in Singapore from the Ministry of Law Singapore, which even includes moneylenders with licences under suspension.

Overview: Loan sharks vs licensed moneylenders in Singapore

  Loan sharks Licensed moneylenders
Legality Illegal Legal
Spamming of unsolicited messages Yes No
Disburse loans remotely Yes No
Interest rate per month Astronomical Capped at 4%
Maximum loan amount Unknown but presumably any huge sum you want 6X borrower’s monthly income if they make at least S$20,000 annually

How do you get a loan with a licensed moneylender?

What’s the amount you’re eligible for?

In Singapore, the amount of money you can loan from a licensed moneylender depends on your annual income. 

Here are estimated loan sums you can expect as a Singapore citizen, Permanent Resident, or a foreigner who resides in Singapore from Crawfort Pte Ltd. However, do note that these are estimates and may vary from one moneylender to another.

Annual Income
Singapore Citizen/Permanent Resident
Foreigner residing in Singapore
Less than S$10,000
At least S$10,000 but less than S$20,000
At least S$20,000
Six times your monthly income
Six times your monthly income

Source: Crawfort Pte Ltd

As you can see, licensed moneylenders don’t rely on your credit score alone to grant you your personal loan. They base it on your annual income.

How much do you have to pay for a personal loan from a licensed moneylender?

The Ministry of Law Singapore has set rules licensed moneylenders must follow, and this covers late fees, interest rates, and other fees. Here is a summary of costs to expect.

Type of fee, interest, or charge Cost
Interest rates Not more than 4% monthly
Late interest Not more than 4% monthly
Late fees Not more than S$60 monthly
Administrative fees Cannot exceed 10% of the loan granted
Legal costs As per court’s orders, moneylenders to retrieve the loan amount

Source: Crawfort Pte Ltd

Documents you need to apply for a personal loan

After you’ve spoken with your preferred moneylender about the terms and conditions, it’s time to get your loan documents in order. 

These documents include:

  • Your NRIC
  • Proof of income
  • Proof of employment
  • Previous CPF statements
  • Latest credit score, which you can get from the Credit Bureau Singapore (CBS) 
  • Additional documents for foreigners:
    • Employment letter
    • Employment pass
    • Tenancy agreement
    • Bank statements

The loan application process

While most licensed moneylenders allow you to kick off the borrowing process online, you still have to visit their office to complete the loan application. This is where you will discuss the following terms with a representative from the company (unless you’re dealing with a private moneylender): 

  • Loan interest rates
  • The types of fees involved (as mentioned above)
  • Late interest charges
  • Instalment payment (the sum you pay within a fixed period until the loan is fully repaid)

Additionally, expect to sign a cautionary statement with the loan contract. This statement warns borrowers of abusive conduct, and tells them where to lodge a formal complaint against a moneylender.


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How long does it take to approve your loan?

According to Unilink Credit, it may take about 5-10 minutes for a licensed moneylender to approve your personal loan, as long as you submit all the required documents.

Documents to keep once your loan is approved

As with any loan, ensure that your repayments are on time, and keep your records in order.

These are the items you should keep:

  • Copy of the loan agreement 
  • Receipt of every payment you make to your licenced moneylender
  • A statement of account (usually issued in January and July) for your outstanding loan(s)

What should you be wary of when dealing with licensed moneylenders?

Here are important things to remember when you get a loan from a licenced moneylender: 

  • Never sign a loan contract that is blank or incomplete
  • Never divulge your SingPass ID or password 
  • Refrain from letting the moneylender retain your ID, passport, NRIC, work permit, employment pass, or other personal documents
  • No part of your loan should be withheld from you without a valid explanation
  • The moneylender must explain the loan’s terms and conditions 
  • The moneylender should not threaten or use bad language when liaising with you

What do I do if my licensed moneylender harasses me?

When pursuing debt repayments, threats and harassment are strict no-nos as they fall under the Registration of Moneylenders’ purview.

If you’re a victim of threat or harassment from a licenced moneylender, you should:

  • Lodge a complaint with the registry at 1-800-2255-529 or
  • Submit your complaint online (click on Registry of Moneylenders and then Feedback and Complaints)
  • Make a police report

When you submit a complaint, you may be asked to participate in an interview for the details of your loan transaction.

Is it an offence to borrow from a loan shark?

Firstly, loan sharks are usually part of crime syndicates with funds from unidentified sources. Therefore, it is most definitely illegal to deal with a loan shark. 

Singapore's loan shark hotline

Loan sharks are a nasty bunch, and it’s not unusual for them to harass debtors. 

Types of harassment people have faced include intimidation, blackmailing, embarrassment, and even gruesome displays of decapitated animals to scare debtors. 

If this happens to you, there are two things you can do:

  • Call the police hotline at 999 or 1800-255-000 for urgent cases 
  • Ring the X Ah Long Hotline at 1-800-924-5664 for any information about loan sharks to be shared with the National Crime Prevention Council

Need debt management assistance? 

The first step towards getting out of debt is to seek help. Sure, you’ll have to persevere for a few years, but when you get out of debt, you’ll be in control of your finances.

Read this article on How Debt Consolidation Can Improve Your Credit Score Over Time if you need help with sorting your finances and improving your credit score. 



Use a personal loan to consolidate your outstanding debt at a lower interest rate!

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