Key Takeaways
- To verify a licensed money lender in Singapore, check the Ministry of Law’s Registry of Moneylenders and match the exact business name, licence number and registered address.
- Even a small mismatch in these details is a warning sign that you may be dealing with an unlicensed lender or loan shark.
- Licensed money lenders cannot solicit loans via SMS, WhatsApp or social media, and cannot approve a loan without an in-person, face-to-face verification.
- Licensed money lenders are capped at a maximum interest rate of 4% per month, with additional caps on late fees and admin fees.
- If you encounter a suspicious lender, you can report it to the Police hotline, the Registry of Moneylenders, or through the police iWitness portal.
Are you worried about getting scammed by a money lender? It’s a valid concern, and checking whether a lender is properly licensed is one of the most important steps you can take before borrowing.
This guide walks you through exactly how to verify a licensed money lender in Singapore, what to check for, and how to protect yourself from unlicensed lenders and loan sharks.
How To Check If A Money Lender Is Licensed In Singapore
Verifying a money lender takes just a few minutes if you know what to check. Follow these four steps:
1. Visit the Official Registry
Go to the Ministry of Law’s (MinLaw) Registry of Moneylenders to view the current, updated list of licensed lenders. You can view the list directly online or download it as a PDF.
2. Match the Details Exactly
Cross-reference the lender’s exact business name, licence number, and registered business address against the official list. Even a small mismatch, a slightly different name, an address that doesn’t line up, is a warning sign that something isn’t right.
Unlicensed lenders often try to explain away why they’re not on the list. Common tricks include:
- Claiming there’s a “glitch in the system” and their company just isn’t showing up
- Saying their company name is different from their brand or trading name
- Displaying a fake moneylending license on their own website, hoping you won’t check further
None of these are legitimate explanations. If the details don’t match the registry exactly, treat it as a red flag.
3. Verify Their Business Practices
Licensed money lenders in Singapore are legally restricted in how they can operate. If a lender does any of the following, it’s a strong sign they’re operating illegally:
- Sends you unsolicited loan offers via SMS, WhatsApp, social media, or cold calls, licensed lenders may only advertise through business or consumer directories, their own website, or their business premises
- Offers to approve or disburse a loan entirely online or remotely, without requiring you to visit their registered place of business for identity verification
- Asks for payment upfront before disbursing the loan
- Requests your Singpass login, banking passwords, or one-time passwords
- Asks to retain your NRIC, passport, or other personal identification documents
4. Report Suspicious Activity
If you encounter an unlicensed lender or suspect illegal solicitation, report it right away:
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- Police hotline: 1800-255-0000
- iWitness portal: https://www.police.gov.sg/iwitness
- Registry of Moneylenders: 1800-2255-529
- Anti-Scam Helpline: 1800-722-6688
- Emergency: 999
When reporting, include as much detail as possible, the lender’s name, licence number (if given), the date of contact, and any messages or documents you received.
What Licensed Money Lenders Can And Cannot Do
Licensed money lenders are regulated by the Ministry of Law and must follow specific rules:
- They can lend for a range of purposes, including personal expenses, renovations, and business needs.
- Interest rates are generally higher than bank loans, and lenders may work with borrowers who have less-than-perfect credit.
- They may withhold up to 10% of your principal loan amount as an admin fee, deducted upon loan disbursement.
They are also restricted from:
- Advertising outside of business/consumer directories, their own website, or their business premises
- Charging more than 4% interest per month, calculated on your outstanding balance
- Charging more than 4% late interest per month on the overdue instalment amount, or more than $60 in late fees per month
- Charging any fees for early repayment or loan pre-approval
- Withholding a thorough, written loan contract, or failing to give you a copy of it
- Changing your contract terms without your agreement
- Retaining your personal identification documents or asking for your banking passwords
- Using threats, harassment, or force to collect payment
- Approving a loan without an in-person, face-to-face verification at their registered office
Note also that the total of all charges combined, interest, late interest, admin fee and late fees, cannot legally exceed the original principal amount of your loan.
How Much Can You Borrow From A Licensed Money Lender?
MinLaw sets the following limits for unsecured personal loans based on annual income:
| Annual Income | Singapore Citizens & PRs | Foreigners |
|---|---|---|
| Under $10,000 | $3,000 | $500 |
| $10,000 to $20,000 | $3,000 | $3,000 |
| Above $20,000 | Up to 6 times monthly income | Up to 6 times monthly income |
For a fuller breakdown, see our guide on how much you can borrow from a licensed moneylender.
What Are The Interest Rates And Fees A Licensed Money Lender Charges?
The fees a licensed money lender can charge are: interest, late interest, a late repayment fee, and an admin fee.
Interest Rate
Interest is capped at 4% per month, calculated on your outstanding balance using a reducing interest model. For example, on a $10,000 loan with a $500 monthly instalment, the first month’s interest is $400 (4% of $10,000). After that payment, $100 goes toward your principal, so the next month’s interest is calculated on the reduced balance of $9,900, and so on.
Late Interest And Late Repayment Fee
Late interest is capped at 4% per month, charged only on the overdue instalment amount, not your full outstanding balance. A late repayment fee of up to $60 per month may also apply.
Admin Fee
Licensed money lenders may charge an upfront admin fee of up to 10% of your principal, deducted when the loan is disbursed. On a $10,000 loan, this means you’d receive $9,000 after the fee is deducted.
Warning: A licensed money lender cannot legally charge this admin fee as a way to offer faster approval, lower interest, a longer tenure, or any other special advantage.
What To Do After Your Loan Is Granted
Once your loan is granted, double-check the interest rates and fees with the lender before signing. Read the contract thoroughly, and don’t hesitate to ask the lender to explain anything you’re unsure about, they’re required by law to be transparent about your loan.
After signing, the money lender should disburse the loan to your bank account within one working day. Going forward:
- Keep your contract, Statement of Account, and receipts in a dedicated folder
- Make copies of these documents
- Set up automatic payments where possible to avoid missing instalments
- If you’re struggling to repay, contact your lender directly, being upfront about your situation can help you negotiate better terms
Frequently Asked Questions
How do I check if a money lender is licensed in Singapore?
Check the Ministry of Law’s Registry of Moneylenders and match the lender’s exact business name, licence number and registered address. Even a small mismatch is a warning sign.
What should I do if a lender’s details don’t match the registry?
Treat this as a red flag and do not proceed. You can report the lender to the Police hotline at 1800-255-0000 or the Registry of Moneylenders at 1800-2255-529.
Can a licensed money lender approve my loan entirely online?
No. Licensed money lenders must verify your identity in person at their registered place of business before a loan can be granted.
Is it normal for a money lender to ask for my Singpass login?
No. Licensed money lenders are not allowed to ask for your Singpass login, banking passwords, or one-time passwords. This is a common tactic used by unlicensed lenders.
What is the maximum interest rate a licensed money lender can charge?
Licensed money lenders are capped at a maximum interest rate of 4% per month, regardless of your income level.
Conclusion
Verifying that a money lender is licensed takes just a few minutes, and it’s one of the most important steps you can take before borrowing. Check the registry, match the details exactly, watch for the warning signs of illegal practices, and don’t hesitate to report anything suspicious.
Lending Bee is a licensed money lender offering competitive rates on personal, business, and foreign worker loans. Our team of loan consultants is happy to answer any questions you have. Find more information, plus a personal loan calculator, on our homepage.
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About Ashley Sim
Calling herself a “professional multi-tasker”, Ashley worked as a relationship manager in a bank for five years. She left her job just before the pandemic happened and became a freelance writer for about a year. Now, she’s making the most of her love for writing and knowledge of the banking and financial industry in her role as a content marketing lead. She hopes to help people make better financial decisions through her content and campaigns.
