When you apply for a loan, you would hope that it will be approved. After all, you have a good credit score, strong employment history, and plenty of assets to put up as collateral. 

It can be disappointing when things don’t turn out the way you want them to. 

So was your moneylender loan rejected? It’s not the end of the world. Still, you’d be left wondering what happened.

Was there something wrong with your paperwork? Or was there another reason behind the rejection?

If this happens, don’t let the rejection bring you down – instead, use it as an opportunity for growth and success. With some time and hard work, there’s no doubt that you’ll be able to find a lender who will see just how trustworthy you really are as a borrower.

Read below to understand the reasons why money lenders may reject your loan application and what you can do to improve your chances of getting your loan approved. 

Reasons Why Your Loan Application Was Rejected

There could be many reasons why you were denied a loan application. Perhaps your credit history contains too many unpaid debts or late payments. 

Or maybe you don’t have enough income to make regular loan payments, making you a risky investment for your lender. 

Below are five potential reasons that may explain why your loan application was rejected:

1. You Have A Lot Of Existing Loans

Having multiple existing debts makes you a risky borrower. It shows that you’re already struggling to make ends meet, so taking on another loan may only add to your financial troubles. 

Hence, lenders will be unwilling to give money to someone who is struggling to keep up with their current financial obligations.

If you want to improve your chances of being approved for a moneylender loan, try paying off some of your existing debts first. 

You can also consider consolidating your debts into one manageable monthly payment. Doing so will give you a much better chance of being approved for future loan applications.

2. Your Credit History Is Poor

It goes without saying your credit history is one of the first things lenders look at when considering your loan application. 

If you have a history of late payments or unpaid debts, chances are your loan application will be rejected. Lenders consider you a high-risk borrower if you have a history of poor credit, which makes them unwilling to give you a loan.

To improve your chances of being approved for a moneylender loan, work on improving your credit history first. You can do this by making all your payments on time and paying off any outstanding debts you may have.

This will also eventually improve your credit score. 

While you may still be able to get a personal loan with bad credit in Singapore, you may be required to provide collateral for the loan and pay a higher interest rate. 

So before applying for a loan with your poor credit history, make sure you can afford the higher interest payments.

3. Documentation Errors

Applying for a loan requires a lot of paperwork. Singapore money lenders are very particular about the documents you submit. 

If even one document is missing or incorrect, your loan application will most likely be rejected.


Sometimes it could be something as simple as an incorrect date or a missing signature. If this is the case, simply resubmit the corrected documents to the money lender. 

If you’re unsure of what the problem is, you can always ask the money lender for feedback on your application. It should be able to tell you what went wrong and how to fix it.

4. You Don’t Meet the Minimum Annual Income Requirement

Financial institutions and banks have pre-set minimum income requirements for personal loans. 

For example, OCBC currently requires a minimum annual income of $30,000 for Singaporeans and permanent residents, while foreigners need to earn at least $60,000 per year.

Licensed money lenders have lower income requirements. If you earn more than $20,000 yearly, you can get a loan amount that is up to six times of your monthly income, regardless of your citizenship status. 

If your income falls below the minimum requirement, you can try applying for a loan with a co-signer who meets the criteria. A co-signer or guarantor is someone who agrees to be responsible for the loan if you can’t make the payments.

Of course, you’ll need to find someone you trust who is willing to take on this responsibility. He or she should also have a good credit score so that the money lender is more likely to approve the loan. 

If you can’t find a co-signer, you might need to wait until you’ve saved enough money to meet the minimum income requirement. Or you could try applying for a smaller loan amount.

5. You Are a New Employee

Lenders usually prefer borrowers who have been with their current employer for at least six months. 

They see it as a sign of stability and an indication that you’re more likely to have the ability to repay the loan.

So if you’ve just started your first job or switched jobs recently, you might want to wait a few months before applying for a personal loan.

In the meantime, you could start saving up money in case your application falls through. You could also try improving your credit score so that you’re seen as a lower-risk borrower.

If you need the money urgently, you could look into other types of loans, such as payday loans. 

But be aware that these usually come with high interest rates and fees.

5 Ways To Improve Your Chances Of Getting Your Loan Application Approved

Whether you’re looking for funding to start a business, expand your current one, or consolidate debt, you will need to go through the loan application process.

Unfortunately, getting your loan application approved can be tough, especially if you have bad credit. So how can you improve your chances of getting your loan approved? 

Here are a few tips:

1. Ensure You Have All the Required Documentation

This may seem like a no-brainer, but ensuring you have everything in order before applying for a loan will save you a lot of time and energy. 

Some key documents include:

  • Your NRIC
  • Proof of income
  • Bank statements
  • Tax returns
  • Business licenses
  • Articles of incorporation
  • Personal financial statements

2. Check Your Credit Score and Report

Your credit score is one of the first things lenders will look at when considering your loan application. A high credit score means you’re a low-risk borrower, which increases your chances of getting approved for a loan. 

Conversely, a low credit score could indicate to lenders that you’re a high-risk borrower and may be less likely to repay the loan.

If you’re a foreigner who is thinking of setting up a business in Singapore, you may be wondering how to check your credit score in the country. 

You can do this by requesting a free copy of your credit report from the two major credit bureaus in Singapore: Experian Singapore and Credit Bureau Singapore.

This will give you an idea of what information lenders will be looking at when they check your credit score.

3. Ensure You Meet the Lender’s Eligibility Criteria

Different lenders have different eligibility criteria. For example, some money lenders may only lend to those who are working full-time, while others may also lend to students and homemakers. 

Make sure you fulfil the money lender’s eligibility criteria before applying for a loan.

If you do not meet the eligibility criteria of the money lender, your loan application is likely to be rejected. 

You can either try to find another money lender with more flexible eligibility criteria or look for alternative sources of financing. Doing a little research beforehand can save you a lot of time and effort in the long run.

4. Apply For The Right Type Of Loan

What’s the purpose of your loan? Do you want a business loan to expand your business? 

Are you looking for a personal loan for your child’s education? Or are you looking to consolidate your debt?

Licensed money lenders offer different types of loans for different purposes. There are personal loans, debt consolidation loans, home equity loans, and more. 

Applying for the right loan for your needs will increase your chances of getting approved.

When you know the purpose of your loan, research different money lenders and compare their products. 

Find out what type of loans they offer and whether any of them meets your needs. Once you’ve found the right money lender, you can proceed to the next step after verifying that it is licensed.

You can do so by checking this list, which is updated regularly by the Ministry of Law. 

A reputable licensed money lender is Lending Bee, which has several branches in Singapore. 

5. Don’t Borrow Beyond Your Repayment Ability

This is one of the most important things to consider when applying for a loan. 

No matter how much you need the money, always remember to borrow within your repayment ability.

Your income and monthly expenses determine your repayment ability. If the money you are earning is not sufficient to cover your current expenses, then it’s unlikely that you’ll be able to repay a loan.

It’s important to be realistic when assessing your repayment ability. If you’re unsure how much you can afford to borrow, use a personal loan calculator in Singapore to find out.

Avoid Being Rejected For A Loan In Singapore

So was your moneylender loan rejected unexpectedly?  

Being rejected for a loan you truly need can feel like a punch in the gut. But don’t worry, all is not lost. 

By following our tips, you can increase your chances of getting approved for a moneylender loan in Singapore. Just remember to do your research and always borrow within your means.

If you’re still struggling to get approved for a loan, consider talking to a licensed money lender like Lending Bee. 

We offer personal loans and debt consolidation loans with flexible repayment terms. We also have a team of experienced loan consultants who can help you through the entire process. 

Contact us now to learn more about our products and services, or apply for a loan now.

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.