Best Credit Lines in Singapore (2020)

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UOB CashPlus

UOB CashPlus

Popular
UOB CashPlus
S$120
Annual Fee
S$750
Min. Monthly Repayment
0%
Prevailing Interest Rate
HSBC Personal Line of Credit

HSBC Personal Line of Credit

Welcome Gift
HSBC Personal Line of Credit
S$60
Annual Fee
S$900
Min. Monthly Repayment
18.5%
Prevailing Interest Rate
Welcome Gift:
Enjoy 0% p.a. interest for 6 months with processing fee as low as 1.5% (EIR 3.26% p.a.). T&Cs apply.
Maybank CreditAble

Maybank CreditAble

Maybank CreditAble
S$80
Annual Fee
S$900
Min. Monthly Repayment
19.8%
Prevailing Interest Rate
DBS Cashline

DBS Cashline

DBS Cashline
S$120
Annual Fee
S$750
Min. Monthly Repayment
20.5%
Prevailing Interest Rate
OCBC EasiCredit

OCBC EasiCredit

OCBC EasiCredit
S$80
Annual Fee
S$900
Min. Monthly Repayment
20.9%
Prevailing Interest Rate
Citibank Ready Credit

Citibank Ready Credit

Welcome Gift
Citibank Ready Credit
S$100
Annual Fee
S$300
Min. Monthly Repayment
20.95%
Prevailing Interest Rate
Welcome Gift:
Receive S$100 GrabFood vouchers for new-to-Citibank Ready Credit Customers. Valid till 30 Nov 2020. T&Cs apply.
SingSaver compares the best Personal Loans in Singapore that range from 1-year to 7-year tenures. The effective interest rate (EIR) you can enjoy from the loans on our site range from 7.0% p.a. to 18.72% p.a. The EIR of your loan will depend on the annual interest rate (or bank advertised nominal interest rate) and the tenure of your loan. For example: a loan of S$10,000 over 3 years at 3.88% p.a. nominal interest would equate to monthly repayments of S$310.11, and the total cost of the loan that you pay back would be S$11,164. This is not inclusive of any administrative or processing fees that may apply.

What is the purpose of a credit line?
A credit line (also known as line of credit) is a type of unsecured loan that allows you to draw on funds when you need it, at up to 4 times your monthly income. Unlike a personal loan where you lock in your loan amount, tenure and interest rate upfront, a credit line charges interest only on the amount you drew down. You also pay fees for opening and maintaining a credit line.

Why do people use a credit line?
A credit line provides flexibility, especially when you need to borrow money multiple times. Rather than taking up a few different personal loans, a credit line allows you to borrow from the same credit account up until the given credit limit.

Read more: 3 advantages of a credit line and how they can benefit you.

What are the downsides to using a credit line?
A credit line could lead to over-borrowing. There are a couple of situations where a credit line might not be ideal:

  • You know how exactly much you need to borrow and you know there won’t be stark changes to the situation that called for the loan.
  • You are a spendthrift or if you lack discipline. Having access to additional funds that you might not require could tempt you to borrow more than you need. With no fixed repayment period, you could end up snowballing your interest by delaying repayments.

In such scenarios, a personal loan could do the trick.

Need some help?
No worries, we've got you covered!
What is a Credit Line (also known as Line of Credit) and how does it work?

A credit line, or a personal line of credit, is an amount of money that you can borrow from the bank when the need arises. You can draw money from this amount until the limit is reached. Much like having a credit card, you have a maximum credit limit on your credit line and may be charged an annual fee. A credit line is also often bundled with a personal cheque book and an ATM or debit card for cash issues and withdrawals.

What is the difference between the loan and a line of credit?

A line of credit is different from a regular personal loan; the latter provides you with cash upon approval, whereas a credit line allows you to withdraw cash via an ATM or complimentary cheque book whenever you need it, although you can also start using it upon approval.

A credit line can also offer flexibility when it comes to the minimum payment. For example, some of the credit lines from banks offer a minimum payment option of 3% of outstanding balance rather than a fixed amount. This keeps payments more manageable.

What is the limit on your credit line?

The limit on your credit line can go up to 4 times the monthly income for the typical borrower. However, if your annual salary is on the higher end (e.g. S$120,000 annually), it may go up to 8 times your monthly income. Unlike a personal loan, your credit line is not disbursed to you directly. This makes a credit line more flexible, as you only borrow what you need, especially when you realise you do not need the full loan amount.

How do you repay a line of credit?

Unlike a personal loan, a line of credit typically has flexible repayment schemes. With a line of credit, you can withdraw cash whenever you need, and the flexibility also comes in the form of repaying early without incurring additional fees.

Some banks allow you to continue the line of credit as long as you just pay off the interest for the amount of credit borrowed. Others, however, require you to pay off both the interest and principal (amount borrowed) at the end of the loan term.

There are a few ways for you to make your repayments, though this differs from bank to bank. These ways include:

  • Internet banking (iBanking)
  • AXS
  • ATMs
  • Cheque deposit
  • Cash repayment at bank branches
  • SingPost branches
  • SingPost S.A.Ms
Who should choose a personal line of credit?

People with periodic, short term need for funds. Upon approval of the credit line, you can withdraw from this loan amount whenever you need the money. For example, small and medium sized enterprise (SME) owners or day traders could choose to get a credit line to fit their short term liquidity needs with repayment flexibility.

How much can I borrow from a personal line of credit?

Banks and financial institutions offer personal lines of credit in amounts ranging from 2 to 8 times your monthly salary. This loan amount depends on your monthly salary, citizenship, as well as your repayment record.

What is the interest rate for a personal line of credit?

The prevailing interest rate for a personal line of credit usually ranges from 18% to 22%. This is lower than the 26% to 28% charged by credit cards. However, some banks and financial institutions also offer low interest rates or interest-free deals for the first few months.

Who shouldn't apply for a personal line of credit?

There is no fixed repayment period for a personal line of credit. This allows you to continuously borrow from the credit line as long as you don't exceed the credit limit. However, if you are a spendthrift who tends to spend more than you earn, you could consider applying for a personal loan instead. A personal loan has a regular repayment schedule in place and this would help you to avoid over-borrowing.

What are the advantages of having a line of credit?

A line of credit allows you to access the credit facility multiple times. This is unlike a personal loan that provides you with a single loan amount. A line of credit also allows you to borrow only what you need. You have the option to choose a repayment term that is manageable for yourself.

Check out the article on 3 advantages of a line of credit and how you can benefit.

What are some of the limitations of a line of credit?

While a credit line gives you flexibility to draw on the funds only when you need it, the interest rates charged for a line of credit is higher than other loan options, such as a personal loan. A personal loan offers interest rates from 3.5% to 10.8% p.a., lower than the 18% to 22% p.a. charged for a credit line. Also, not all banks offer foreigners the option to apply for a line of credit.

Should I apply for a personal line of credit for my small business?

A personal line of credit can be a loan option to consider if you have plans to borrow money periodically. It also provides you with flexible repayment terms. However, there are also other loan options available - in this case, there are SME loans available for small businesses in Singapore.

Which bank offers the best personal line of credit?

Not all banks offer a personal line of credit. Banks that offer a credit line include: UOB, DBS, OCBC, Citibank, HSBC and Maybank. To decide on the credit line that is best for you, you can compare by:

  • Annual fee
  • Prevailing interest rate
  • Minimum monthly repayment

You can also filter based on the provider. For example, you may choose the bank that you do most of your banking with, or a new one that offers new-to-bank promotions such as cashback or lower interest rates.

What are the fees incurred when you get a line of credit?

Besides the interest that you pay on the credit that you draw, there are also other fees that you could incur when you get a line of credit. This includes:

  • Annual fee: S$60 to S$120
  • Late payment charges: S$75 to S$125
  • Overlimit fee: S$40 to S$50
  • Handling fee/returned cheque: S$40
Tips for using a line of credit:

Here are some tips to keep in mind when using a line of credit:

  • Ensure that the line of credit you apply for is sufficient as there are fees incurred when you borrow over the limit
  • Borrow only what you need because interest will be charged on the credit used
  • Take note of other charges that you could incur
  • Make early payments if possible to reduce future interest payments
  • Keep a lookout for ongoing promotions
When not to use a line of credit?

If you are already sure about the amount of money you need to borrow, you could consider taking a personal loan instead. A personal loan offers interest rates lower than the interest rates for a credit line. Currently, the personal loan interest rate ranges from 3.5% to 10.8% per annum. This interest rate varies across banks and depends on factors such as the loan tenure. There are also various promotions for personal loans, offering perks such as cashback or lower interest rates.

What are the eligibility criteria and requirements for getting a line of credit?

To apply for a credit line, you have to be:

  • At least 21 years old
  • Minimum annual income of S$30,000 (for Singapore citizens or Singapore Permanent Residents). If you earn between S$20,000 - S$29,999 banks such as DBS and OCBC still offer credit lines, at a higher prevailing interest rate.

Some credit lines are also only available to Singapore citizens or Singapore Permanent Residents.

Confused by terms used in Personal Loan?

Glossary terms to know for first-time personal loan applicants

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