Many people today live in debt due to poor borrowing and spending habits. As a result, taking a loan has become more commonplace and is no longer considered a last resort.

In fact, many lenders are willing to offer borrowers money as long as they can guarantee that they will be able to repay the debt.

Unfortunately, this opens consumers to predatory lending habits from loan sharks who may take advantage of them. So how can you ensure you’re not getting scammed by a fake money lender?

Read our guide below to learn everything you need to know about moneylender rules.

How To Know If A Money Lender Is Licensed

In order to operate legally in Singapore, all money lenders must be licensed and registered with the Registry of Moneylenders.

This ensures they are qualified and reputable businesses that will not take advantage of their customers.

You can easily check if a money lender is licensed by searching for the lender’s business name on the Registry of Moneylenders’ website published by Singapore’s Ministry of Law.

The website also lists the contact information for each licensed money lender so that you can verify all the money lenders’ legitimacy before working with them.

In addition, the Registry is updated regularly, so you can be sure that the information is accurate and up to date.

What Are The Interest Rates For Licensed Money Lenders?

Interest rates vary from lender to lender and are dependent on how much you borrow.

In general, licensed money lenders can charge up to 4% per month. In comparison, credit cards in Singapore typically charge annual interest rates of 25-30%.

So if you carry a balance on your credit card and are only making minimum payments, you’re probably paying more in interest than if you had borrowed from a licensed money lender.

The effective interest rate takes into account the fact that you’re only paying interest on the outstanding balance, not the entire amount borrowed.

How Much Can You Borrow?

The amount of money that you can borrow from banks and licensed money lenders in Singapore depends on various factors.

These include your credit standing, monthly income, and the type of loan being requested.

For example, an individual with a strong credit rating and a stable source of income may be able to borrow up to $3,000, while someone with a less favourable credit history or lower income may only qualify for a smaller loan.

The below table will give you a better idea of how much you can borrow based on your annual income.

Annual IncomeMaximum Amount That Foreigners Living In Singapore Can BorrowMaximum Amount That Singapore Citizens And Permanent Residents Can Borrow
Lower than $10,000$500$3,000
Between $10,000 to $20,000$3,000$3,000
More than $20,000Up to 6x their monthly incomeUp to 6x their monthly income

When the loan is granted, the lender can charge an admin fee of up to 10% of the principal amount of the loan. So if you borrow $500, the processing fee would be $50.

Remember, different types of loans have their own parameters for how much can be borrowed.

For instance, a personal line of credit might allow you to borrow a larger sum than an installment loan or payday loan would.

Ultimately, when it comes to borrowing money in Singapore, it is important to do your research and carefully assess your personal financial situation before committing to any agreements or terms.

By doing so, you can ensure that you stay within your borrowing limits and protect yourself from future financial pitfalls.

What Are The Repayment Terms?

The repayment terms for licensed money lenders are typically one to three months for short-term loans and three to 60 months for longer-term loans.

Some money lenders may require weekly repayments, while others may give you the flexibility to make monthly payments.

Make sure you understand the repayment terms before you sign any loan agreement. Ask the money lender how much you’ll need to pay each month and when the loan is due in full.

Ensure these terms are written clearly in the loan contract before you sign it. If you’re not sure, ask for a written statement of the repayment terms.

To protect yourself, ensure you understand all the repayment terms and only borrow an amount that you can afford to repay.

If you can’t make the payments, contact the money lender immediately to work out a new payment plan.

What Are Late Payment Fees?

In addition to interest, licensed money lenders are also allowed to charge a late payment fee of $60 for each month of late repayment.

How To Settle A Licensed Money Lender

If you’re having trouble repaying a loan from a licensed money lender, there are a few things you can do.

First, try to work out a new payment plan with the money lender. If that doesn’t work, you can contact Credit Counselling Singapore (CCS) for help.

CCS is a government-funded organisation that provides free counselling and education to people with debt problems. It can help you negotiate with your creditors to try to work out a repayment plan.

You can also contact the Singapore Mediation Centre (SMC) to arrive at a resolution with the money lender. The SMC is a government-funded organisation that provides mediation services for all types of disputes, including debt disputes.

If you’re still unable to resolve the situation, you can file a complaint with the Registry of Moneylenders. The Registry regulates all licensed money lenders in Singapore.

You can also file a police report if you think you’ve been a victim of fraud or harassment by a licensed money lender.

What Are The Penalties For Not Repaying?

If you don’t repay a loan, the money lender may take legal action against you. This could include filing a civil lawsuit or sending a debt collector after you.

If the money lender wins the lawsuit, it may be able to garnish your wages or put a lien on your property.


When applying for a loan, there are certain requirements that must be taken into account.

You will need to input the following information into the application form:

  • Your full name
  • NRIC
  • Address
  • Nationality
  • Contact information (phone number and email address)
  • Amount you need to borrow

If the lender requires a surety, you should also submit the person’s particulars.

A surety is an individual who guarantees the lender that your loan will be repaid in case the borrower defaults on the loan.

In your application, you should also include supporting documents in order for the money lender to proceed with your application. These include:

  • Payslips
  • Utility bills for proof of address
  • Proof of your total income for the past three months before the application date
  • Income tax statements

If you’re a foreigner living in Singapore, the lender may require additional supporting documents such as:

  • Your passport
  • Your work visa or permit
  • Proof of employment in Singapore (letter from employer)
  • Additional bank statements
  • Copy of your tenancy agreement

The above are general requirements for most money lenders in Singapore.

However, it’s important to note that each lender has different policies and procedures. As such, you should always enquire about the specific requirements of the lender you’re looking to borrow from.

What Should Happen Before And After Loan Approval

After the required documents have been submitted and approved, the lender should give you a loan contract to sign.

This document includes important terms and conditions that both parties must agree to, such as the:

  • Amount being borrowed
  • Repayment period
  • Interest rate
  • Late payment fees
  • Default penalties

Before signing on the dotted line, be sure to take the time to read and understand the contract in its entirety.

If there’s anything you’re unsure about, don’t hesitate to ask the lender for clarification. Once both parties have signed the loan contract, the money should be disbursed to you in a lump sum at the lender’s office.

From there, it’s up to you to make sure that you meet your end of the bargain by making timely and full loan repayments.

If you do so, you can avoid late payment fees or default penalties. You’ll also be able to maintain a good relationship with the money lender in case you need a loan again in the future.

Get the Right Loan Today

It goes without saying that it’s important to be aware of moneylender rules and regulations in Singapore before applying for a loan.

By doing your research and ensuring that you understand all the requirements, terms, and conditions involved, you can protect yourself from financial hardship down the road.

If you’re in need of quick cash and are considering applying for a loan, be sure to check out Lending Bee.

We offer personal loans with flexible repayment plans that suit your needs.

Plus, our application process is quite easy and only takes a few minutes to complete. 

If you need help, contact our experienced loan officers, who will be more than happy to assist you. Or apply for a loan with us 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.