women getting car loan

It’s a significant puzzle that every Singaporean dreaming to own a car must answer: should I go for a COE renewal loan from a bank or the in-house government-sponsored financing readily available?

A Certificate of Entitlement is a hard-won right for Singaporeans to own a vehicle in the country for any purpose. While transportation and traffic is barely a problem in public commutes, a particular joy exists when you drive and own a vehicle. In a nutshell, this certificate is necessary to curb vehicle sales, causing potentially time-consuming traffic on the small country’s roads.

To make sure you always have a well-maintained vehicle, the government runs a particular bidding program. Unfortunately, once you de-register your vehicle, you give your license to the government, which they’ll revoke or renew depending on your decision.

Should You Renew Your COE License?

It’s essential to renew your license if you want to keep your car and its benefits forever. On the other hand, if your vehicle needs were temporary, you can trade it back for a fortune and give another Singaporean the chance to drive vehicles.

Later, we’ll explain that you can only renew your license for certain vehicles only one time after five years. Meanwhile, you can renew certain vehicles every five years until the government deems the vehicle unfit for roads and requires de-registration.

How to Renew Your License

It’s easy to renew your license. Head to the COE’s website then login with your credentials. Next, choose the renew option, leading you to a page you’ll need to fill out. Once done, submit it and wait for an approval notification to renew or license revocation plus vehicle de-registration.

If you decide to renew your license, you must renew it a month before it expires. Additionally, you will need to renew your vehicle every five or ten years, depending on your vehicle’s category. Here is a table to know your vehicle’s classification.

CategoryVehicle Type
ABelow or up to 1,600cc & 97kW (130BHP)
BAbove 1,600cc or 97KW (130BHP)
CSupplies and Goods Transportation and Buses
EOther vehicles except motorcycles

Vehicles in categories A, B, and D can only renew their license once. After their renewal, COE license owners will have to de-register their vehicle and surrender their COE.

On the other hand, vehicles in category C can renew their licenses every five years. However, once its lifespan falls beyond the government-indicated statutory lifespan, you’ll need to de-register the vehicle immediately.

However, this does not mean you cannot get a new license once again. If you’re willing to go through the Land Transportation Authority’s COE Bidding System and win through the highest bid, you can own a vehicle once again.

COE-registered vehicles renewable once or unlimited times after five years requires license holders to pay 50% of their COE’s Prevailing Quota Premium (PQP) upon receiving qualification to renew their license. All vehicles renewable after 10 years must pay the full PQP value upon receiving license renew approval.

If you consider the PQP value going as high as S $40,000-60,000 regularly, it’s no surprise that using a loan to pay for the half or full amount is a practical and time-efficient solution. A loan to renew COE is beneficial because the COE renew process has an expiration date. With loans, you can pay for your PQP and renew your license and worry later repaying it.

You have two options to renew COE conveniently: using a bank or the in-house PQP financing services. Each one has their respective pros and cons.

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Bank COE Car Renewal Loans


In most cases, banks offer a car loan in Singapore, but most Singaporeans forget that banks provide a COE loan to help with prevailing quota premium expenses and renew your license. COE license holders can expect banks to provide better interest rates than in-house prevailing quota loans.

You can find banks that offer an interest rate of 2-3% for the amount you’ll pay for the prevailing quota premium. This interest rate is much better than the staggering 3-4% interest rate you’ll get for in-house COE renewal financing.

Additionally, that’s just the minimum interest — it can increase depending on the loan amount and tenor your choose.


However, banks rely heavily on borrower data and credit performance. If your credit history shows evidence of poor financial management, indicating a problematic trend, you might face rejection and referral to in-house loans to renew licensure.

The bottom line is, if you have poor credit scores, bank prevailing quota premium loans to renew your license will take some time to become your best option. You’ll need to raise your credit scores if you want to enjoy lower interest rates with bank prevailing quota premium financing.

In-House COE Renewal Car Loans


Unlike banks, in-house loans for licensing isn’t as complex as a bank car loan or prevailing quota premium loan. The government-backed financing service will walk you through the entire process. While they might have higher interest rates than banks at 3-4%, you might get lucky if you find promotional rates as 1.88%, which beats bank rates by a huge mile.

Additionally, in-house loans receive quicker approval than bank loans due to the absence of credit checks. If you’ve received clearance to renew your license, it’s enough for the in-house service to help you with their prevailing quota premium services.


Unfortunately, you’ll always be stuck with the 3-4% interest common for most 5 years, 7 years, and 10 years PQP for in-house financing. Truthfully, lucky promos that go from 1.88-2% interest will often have higher administrative fees, slightly offsetting the deducted promotional value.

While it’s convenient to have many middlemen to process your license renewing and file your in-house PQP plan, these individuals leverage their reputation, allowing them to set an out-of-bounds loan amount and interest rate. If you plan to use middlemen, make sure to check their qualifications and read their terms and conditions before signing anything.

Be wary that some loan sharks or criminal organizations can pose as financing middlemen. Check company registration numbers and licenses, online forums, and the COE itself regarding the existence of your prospect middlemen.

Other Options

Truthfully, you have numerous alternatives to both bank and in-house financing. One of them is working with a licensed moneylender, who provides quick cash with the same maximum interest ceiling as in-house financing. Additionally, you won’t need to provide a high credit score.

Truthfully, moneylenders monitor your credit rating, but it has little bearing on their decision to provide loan services. Alternatively, licensed moneylenders may require you to pay the entire financing in less than a year, a common loan tenor for personal loans.

Let’s compare all the financing available for COE PQP requirements in this table:

Type of LoanConvenienceInterest RateRepayment Terms
BankBank Offer Variety2-3%1-2 Years
COE In-HouseHelpful Staff3-4%1 Year
PersonalEasy Licensed Moneylender Terms3-4%1 Year

It’s Never Difficult to Make The Right Decision

If you’re looking for a winner of the best financing to use for your PQP financing, the results are truthfully a draw on all three sides. Bank loans can offer you great rates, but with bad credit,

you’ll face a high probability of rejection. Additionally, many borrowers know banks to take so much time to approve, process and release loan amounts to customers.

In-house financing is useful and convenient. With helpful staff, you can apply for financing with complete requirements. Additionally, they’ll remind you if you forgot to submit some forms, giving you more time to resubmit them when necessary. Additionally, you won’t need to wait too long for approval as long as you are eligible and comply with all their requirements.

If either of these two financing options appeals to you, licensed moneylenders personal loan, such as top-ranked services by Raffles Credit, is the best alternatively. Like in-house financing, you can get your loan application approved in a single day, and you’ll submit relatively lighter requirements — including little to no impact of your bad credit score with your application.