Free Beginners Guide to Borrowing from a Credit Company in Singapore

A credit company in Singapore has been helping Singaporeans get by throughout the years. Whether you are employed or an entrepreneur is seeking to widen your company’s reach, a loan is a handy tool. It helps you thrive or bridge a financial gap. However, getting a loan from a credit company in Singapore is not something you can take lightly.

Not because you can find many credit companies around the city-state does not mean that you can just choose one and borrow cash from any of them without proper research.

The Singaporean government has been concerned by the growing number of Singaporeans taking too many loans than they can handle.

The lack of foresight when borrowing cash can be your financial downfall. However, borrowing money is a helpful tool for an intelligent borrower. And being a responsible borrower does not start with repaying your loan on time to your credit company. It actually begins with choosing which credit company in Singapore to trust.

10 Questions to Ask a Credit Company in Singapore

1. Are you a licensed lender?

In short, a credit company thriving in the lending industry for a long time means there is already a reputable background that you can count to. To verify if a money lender is legally operating, you must check the list of licensed money lenders provided by MinLaw.

2. How much can I borrow?

If you exceed your loan cap, you will no longer be eligible to get an unsecured loan from any credit company in Singapore. While it is tempting to borrow more, a responsible money lender will likely decline a borrower who cannot repay the loan on time.

With the help of the Moneylenders Credit Bureau (MLCB), a credit company will know how much you can still borrow. It prevents you from getting too many loans that you can handle. After all, a credit company just wants to lend and get repaid on time to keep their business running.

3. What is the interest rate?

The late interest is charged only on the unpaid loan amount and not on the principal loan amount or the amount that is not yet due to be repaid.

4. What are the terms and conditions?

MinLaw requires every credit company to be clear and transparent with its terms and conditions. For example, get a loan only if the credit company could discuss and explain the crucial details in your loan contract.

Furthermore, make sure you fully understand every term in your contract, especially the interest rate, fees and repayment schedule. Bear in mind that the contract is legal and binding. It is the borrowers’ finances to hold their side of the contract.

5. Do you have flexible loan packages?

A reputable credit company will be willing to help you choose the most flexible option to help you repay your loan with ease.

6. How fast is the loan process?

The earlier you can complete your required documents, the faster you will process your loan application. For example, if you apply to Cash Mart, you can get your cash in as short as an hour to a day.

7. Is the loan advertisement real?

Did you receive or see any advertisements like SMS, emails, flyers or any forms of prohibited advertisements? It can be any of these two. First, they are from a licensed moneylender not following the strict rules and regulations. Or second, it is an unlicensed moneylender trying to fish for unsuspecting victims.

Do not respond to any illegal advertisement. Instead, report it to the Police or the Registry of Moneylenders.

8. What is the eligibility requirement?

Some credit companies only have loans for Singaporeans and Permanent Residents. Others give a loan to foreigners who have proper working documentation. Others offer loans to low-income earners, while others do not. Shop around to know which credit company can serve your needs.

9. Do you have friendly support?

In addition, many borrowers also appreciate it if the loan officer considers their personal preferences and needs. In addition, Cash Mart’s loan advisers and friendly and attentive. If you want to get advice on your loan-related matters, you can feel free to send a message on WhatsApp, call, or visit them.

Furthermore, a reputable credit company even helps customers who want to learn more about financial literacy.

10. What are the other fees that a credit company in Singapore can charge?

Take note that MinLaw permits money lenders to deduct a loan approval fee of up to 10% from the principal amount. However, they can’t ask borrowers to pay an upfront fee prior to the loan process approval or disbursement.

What to Do After Your Loan Is Granted?

As a responsible borrower, you must first check if the right loan amount has been disbursed. Then, get your own copy of the loan contract and meet the repayment schedule. Every time you make a repayment, be sure to keep the receipt safe. It will be proper documentation that you paid the right amount on time.

Being a smart borrower gives you the chance to build a positive relationship with the credit company. Also, you can build a healthy credit score that you can use to have better loan offers.

Signs That You Are Dealing With a Loan Shark

No licensed credit company in Singapore should use abusive language or behave threateningly. In addition, they must not ask for your SingPass user ID and/or password over the phone, email, SMS or through the online application. Add to that. They should not retain any of your personal ID documents.

Additionally, ensure that you do not sign an incomplete contract. A loan contract must have complete terms and conditions. Also, it must indicate your loan amount, repayment scheme and dates, and other fees. They must properly discuss the loan contract. It helps you understand what you are signing into.

No fair practising credit company will approve a loan without any due diligence. Therefore, even before you can completely file your application, approving your loan is an absolute red flag.

Should you encounter an Ah Long or a licensed money lender with unfair practices, you must report it to the Registry at 1800-2255-529. Rest assured that they will not disclose your personal details.