How does money lending work in Singapore?

Irrespective of how well we manage our finances, life can throw surprises at us. When we are in such a situation and we need a certain amount of money we end up borrowing from someone. That someone could be a friend, a relative, or a moneylender. The Singapore government aptly understands the need to protect both borrowers and moneylenders. This is done through a legal document that is also known as the Moneylenders Act. If you want someone good at personal loan in toa payoh central, you are right.

How to know if a moneylender is licensed?

Money lending in Singapore is now a full-fledged industry. There are as many moneylenders as there are borrowers. Dealing with a licensed moneylender protects the borrower from scams. However, there are hundreds of moneylenders in Singapore who are both legal as well as illegal. The most legitimate way to find out if a certain money lender is licensed and trustworthy is to simply check the list of valid moneylenders, that are registered in the Republic of Singapore. This list is published by the country’s Ministry of Law. The list was last updated in Aug 2021. The Ministry of Law regularly releases such an updated list.

What is the maximum you can borrow?

Several factors decide the actual amount of money you can borrow from a moneylender. If it’s a secured loan you can borrow any amount of money. When it is an unsecured loan, borrowers fall under various categories. If you are a Singapore citizen with an annual income of less than $20,000 you can only borrow an amount of up to $3000.For those earning more than $20,000 annually, you are allowed to borrow money up to six times your monthly income. When you are not a Singapore citizen the terms change. Those earning less than $10,000 each year can borrow only $1,500. If you are earning something between $10,000-$20,000 annually you can borrow up to $30,000. If your annual income is higher than $20,000 can borrow up to six times your monthly income.

Interest rates and other charges

According to Singapore’s moneylender’s act, the maximum interest rate that they can charge per month is 4%. This is regardless of your income and also whether it is a secured or unsecured loan. Borrowers can be charged a maximum of $60 per month for each month of repayment. Another is the loan fee that cannot be more than 10% of the principle of the loan. in case of a successful claim by the moneylender for the recovery of the loan borrowers must pay for legal costs set by the court.


For a detailed understanding of interest rates and other charges, you can look up the helpful guide from the Ministry of Law. The details listed in this are based on the Moneylenders Act. Borrowers can be greatly benefitted from the Moneylenders Act as it serves as the most important document when it comes to moneylending.