Customer shaking hands with the best money lender in Singapore

Choosing a licensed moneylender in Singapore requires careful consideration to ensure you engage with a reputable provider. 

This guide explores the essential traits of a good licensed moneylender, the types of loans available, and how to navigate the application process. 

Read on to learn more about identifying and avoiding unlicensed moneylenders, ensuring a safe and reliable borrowing experience.

Best Licensed Moneylenders in Singapore

Choosing the best licensed moneylender in Singapore involves considering key traits such as the following:

1. Verified by the Registry of Moneylenders

A good moneylender should be listed on the Ministry of Law’s Registry of Moneylenders, ensuring they comply with all legal requirements and regulations.

2. Clear Terms and Conditions

They should provide clear and transparent terms and conditions, detailing all fees, interest rates, and repayment schedules without hidden costs. Contracts should be comprehensive and easy to understand, protecting the interests of both the lender and the borrower.

3. Professional and Friendly Staff

Excellent customer service with knowledgeable, professional, and courteous staff who can guide you through the loan process and answer any questions. Look for positive reviews and testimonials from previous clients indicating high levels of customer satisfaction.

4. Reasonable Interest Rates & Fees

Moneylenders should offer reasonable rates, with a maximum of 4% per month, and flexible repayment options. Fees are capped at $60 per month for late repayment, 10% of the loan principal as an administrative fee, and court-ordered legal costs. Total charges, including interest and fees, cannot exceed the principal amount of the loan.

For example, if you take a loan of $10,000, the interest, late interest, administrative fees, and monthly late fees combined cannot exceed $10,000.

5. Efficient and Fast

Streamlined application and approval processes, allowing you to access funds quickly, often within the same day. Options for online applications and quick processing times for added convenience.

6. Adherence to Regulations

Compliance with all regulatory standards set by the Ministry of Law to protect borrowers from predatory practices. Ensuring the security and confidentiality of personal information with advanced data protection measures.

7. No Predatory Lending

Avoiding unethical practices such as exorbitant interest rates, hidden fees, or aggressive debt collection methods. Treating all clients with fairness and respect, regardless of their financial background.

Be a Smart Borrower

When borrowing from licensed moneylenders, it’s essential to understand the regulations governing loan amounts, interest rates, and fees. Being informed about these terms helps you make smart borrowing decisions and protects you from ah longs.

Permitted Loan Amount, Rates And Fees, And Repayment Terms

Licensed money lenders are legally restricted in terms of the amount they can lend, fees they can charge, and allowed interest rates. They are also legally bound to give you details on your lending agreement and repayment schedule or terms. The loan contract must:

  • Reflect the principal loan amount, the interest rate applied, and the amount payable.
  • Be signed by the borrower and the moneylender.
  • Contain all essential information about the loan.

To protect the borrowers better, the Ministry of Law has implemented the amended Moneylenders Act and Moneylenders Rules in 2018. Both were put in force last November 30, 2018, to ensure that borrowers have safe access to personal credit.

Here’s more to know when borrowing from licensed moneylenders:

Loan Amounts

  • Secured Loans: You can obtain a loan of any amount.
  • Unsecured Loans: The maximum amount you may borrow at any time across all moneylenders in Singapore is as follows:
    • Less than $10,000 annual income: Up to $3,000 for Singapore Citizens and Permanent Residents, and $500 for foreigners residing in Singapore.
    • At least $10,000 but less than $20,000 annual income: Up to $3,000.
    • At least $20,000 annual income: Up to 6 times your monthly income.

Interest Rates

  • The maximum interest rate that moneylenders can charge is 4% per month, regardless of the borrower’s income and whether the loan is secured or unsecured.
  • If a borrower fails to repay the loan on time, the maximum rate of late interest a moneylender can charge is 4% per month for each month the loan is repaid late.
  • Interest is computed based on the remaining principal after deducting repayments made. For instance, if you take a loan of $10,000 and repay $4,000, interest is calculated on the remaining $6,000.


  • A fee not exceeding $60 for each month of late repayment.
  • A fee not exceeding 10% of the principal of the loan when the loan is granted.
  • Legal costs ordered by the court for a successful claim by the moneylender for the recovery of the loan.
  • The total charges (interest, late interest, administrative fee, and late fees) imposed on any loan cannot exceed an amount equivalent to the principal of the loan. For example, if you take a loan of $10,000, the total charges cannot exceed $10,000.
advantages and disadvantages

Advantages and Disadvantages of Getting Loans From Licensed Moneylenders

When deciding between unsecured and secured loans from licensed moneylenders in Singapore, it’s essential to weigh the pros and cons of each. Here’s a breakdown to help make the decision clearer:

Unsecured Loans:

  • Advantages:
    • No Collateral Required: Borrowers do not need to secure the loan with their assets, making it a viable option for those who may not have collateral.
    • Faster Approval: Typically, unsecured loans have a quicker processing time since there is no need to evaluate collateral. You can get your loan approved within 30 minutes to a day.
    • Less Risk to Personal Assets: Since the loan is not tied to any asset, your property remains unaffected in case of default.
    • Flexible Repayment Options: Borrowers can choose terms ranging from 6 months to 5 years, allowing them to align their payments with their income and budget. This flexibility helps manage monthly payments and can alleviate financial stress.
  • Disadvantages:
    • Higher Interest Rates: To offset the risk of not having collateral, lenders charge higher interest rates on unsecured loans. Generally, interest rates for unsecured loans can range from 5% to 36%.
    • Lower Loan Amounts: For unsecured loans, lenders often provide loan amounts that range from $1,000 to $50,000. The exact amount a borrower can qualify for depends on their credit score, income, and overall financial profile.

7 Types of Loans You Can Apply For With Licensed Moneylenders

When you’re looking for funds, licensed moneylenders can be a good choice because they offer various types of loans to suit different needs. Below are the main loan types and their benefits.

1. Personal Loans

Personal loans are meant to provide flexibility for a variety of uses, from emergency expenses to major purchases. They generally come with fixed repayment terms and can be tailored to suit individual financial situations, making them a popular choice for quick financial assistance.

2. Payday Loans

Payday loans are short-term loans designed to cover expenses until the next paycheck. They are typically quick to obtain but come with high interest rates and are intended for urgent cash flow needs.

3. Business Loans

Business loans cater to entrepreneurs and business owners looking to expand, invest in new equipment, or manage cash flow. These loans are crucial for sustaining operations or fueling growth and are available with varying terms based on business needs.

4. Renovation Loans

Renovation loans as specifically intended to fund home improvements. Whether updating an old kitchen or expanding a living space, these loans can help homeowners invest in their property’s value and aesthetic appeal.

5. Education Loans

Education loans provide financial support for students and families looking to cover tuition and other educational expenses. These loans ensure that finances are not a barrier to accessing quality education.

6. Debt Consolidation Loans

Debt consolidation loans allow individuals to combine multiple debts into a single loan with a potentially lower interest rate. This simplifies monthly payments and can help manage debt more effectively.

7. Matrimonial Loans

Matrimonial loans help cover the expenses associated with weddings and related events. Given the significant costs of weddings, these loans provide a financial solution to help couples celebrate their special day without financial strain.

By understanding these loan types, you can choose the one that best fits your needs. Licensed moneylenders offer a range of options, each with its own benefits, to help you manage your finances more effectively.

Loan Application Process

Applying for a loan from a licensed moneylender in Singapore involves several steps, each designed to ensure compliance and satisfaction for both parties. Here’s a detailed breakdown of the process:

Eligibility Check:

  • Initial Requirements: You must be at least 21 years old. For Singaporean and PR residents, you need to have regular employment or a source of income above $2,000 per month. Foreigners must have regular employment or a source of income above $3,000 per month.
  • Income Requirements: Proof of income through payslips or bank statements is usually necessary.

Documentation Preparation:

  • Required Documents for Singaporean/PR Residents:
    • Identity card / NRIC
    • Proof of residence such as a recent bill or letter addressed to you (if you do not own the residence)
    • Tenancy agreement (if you are renting a flat)
    • Recent 3 months payslip and employment letter if your current employment is less than 6 months
    • Know your SingPass (to log into CPF, HDB, IRAS website)
  • Required Documents for Foreigners:
    • Valid work permit / S Pass / Employment Pass
    • Passport
    • Proof of employment (staff pass or company pass)
    • Recent 3 months payslips and employment letter
    • Proof of residence such as a tenancy agreement, recent bill, or letter addressed to you
    • Latest bank statement of account to which yearly or monthly salary is credited
    • SingPass (to download IRAS NOA)
  • Application Form: Fill out the loan application form, which includes personal information, financial status, and loan details.


  • Submit Application: Once all documents are gathered, submit the application and supporting documents either online at the moneylender’s website or at their office.

Loan Approval:

  • Approval Process: This process can take anywhere from a few hours to a day, depending on the lender and complexity of the loan.
  • Signing the Agreement: Once approved, you’ll be asked to sign a customized loan agreement, which outlines the terms of the loan, including interest rates, repayment schedule, and other legal obligations.

Disbursement of Funds:

  • Receiving the Loan: After the agreement is signed, funds are typically disbursed on the same day.


  • Repayment Terms: Ensure you understand the repayment terms, which include the installment amounts and due dates.
  • Late Payment Penalties: Be aware of any penalties for late payments to avoid additional charges.

By understanding and preparing for each step of the loan application process, borrowers can ensure a smooth transaction and avoid any unexpected complications.

how to spot and avoid unlicensed moneylenders

How to Spot and Avoid Unlicensed Moneylenders

Navigating the financial landscape requires vigilance, especially when identifying and avoiding unlicensed moneylenders. Here’s how you can protect yourself and recognize potential red flags:

Red Flags to Watch Out For:

  • Aggressive Marketing Tactics: Unlicensed moneylenders often use unsolicited calls, messages, or emails to attract customers, which is illegal for licensed lenders.
  • Lack of Transparency: Be wary if the lender does not clearly disclose fees, interest rates, or provide a formal contract. A legitimate moneylender will always ensure transparency in all transactions.
  • Unofficial Communication Methods: If communications are conducted via mobile apps like WhatsApp or through personal mobile numbers, this is a significant red flag.
  • Request for Personal Passwords: No licensed moneylender will ask for your SingPass user ID or password, or any other sensitive personal information.
  • Physical Harassment: Any form of threats, harassment, or intimidation is a clear indication of unlicensed lending.

What to Do if You Suspect a Lender is Unlicensed:

If you have been approached by or have fallen victim to an unlicensed moneylender, report the incident to the police or the National Crime Prevention Council.

Other Prohibited Practices for Licensed Moneylenders

The unscrupulous practices of loan sharks have skewed an unfair image and impression to licensed money lenders. Thus, the government has put regulations on the money lending practice. To inform you better, here are unacceptable acts that licensed money lenders are not allowed to do:

  • Ask for your Singpass details, including passwords
  • Any form of abusive language, threats, or harassment
  • Keep on hold essential documents like your NRIC, IDs, Bankbooks, or ATM cards
  • Ask you to sign any blank document
  • Approve your loan via email or SMS
  • Grant the loan without explaining in detail the terms and conditions
  • Put on hold a part of the principal amount for whatever reason

Final Word

The best moneylender meets your needs, communicates clearly, and offers flexible repayment options. Make an informed choice to avoid high-interest rates and unreasonable terms. 

Key Takeaways:

  • Interest rates from licensed moneylenders typically range from 1% to 4% per month. Always compare rates and fees from multiple lenders to find the most affordable option.
  • Verify that the moneylender is licensed by the Ministry of Law in Singapore. Licensed lenders adhere to regulations that protect borrowers from predatory practices.
  • Choose lenders that offer flexible repayment options, such as weekly, bi-weekly, or monthly schedules, and varied repayment periods. This flexibility can help you manage your finances more effectively.

If you’re seeking the best licensed money lender, look no further than Raffles Credit. Visit us and avoid the trap of high-interest rates and unreasonable repayment terms. Request a free quote today!