This is why many Singaporeans tend to check out money lending companies in Singapore or popularly known as loan sharks. Although licensed money lenders in Singapore have similar characteristics with banks like being a business man which explains the interest rates. They are licensed by the government by the Registrar of Money Lenders so they don’t get imprisoned by the authorities and they run after borrowers through reminder letters.Here are the differences that make licensed money lenders in Singapore very attractive especially to those who have bad credit standing:
Licensed money lenders in Singapore center on small loans unlike banks that can give huge loans to only 1 client. Money lenders have specific amount that you can loan even if your monthly income is huge. One lending company in Singapore can only allow $1,500 for yearly income of more than $30,000. The reason behind this, the law only allows the borrower to lend 2 to 3 times his monthly income. This is to make sure that the borrower can really pay his monthly dues. This kind of loan is not advisable for renovations plans or starting a business as these lending companies would not risk that huge amount of money to only 1 client. This kind of loan is only good for car maintenance payment, paying small medical bills or budget plane tickets.
Approval of licensed money lenders in Singapore is very quick; some even offer 30 minutes approval if you are able to provide all the necessary documents they required. This is one of the benefits of lending companies; they give you quick cash for emergency purposes. This is the only thing that banks could not offer their customers are they do a very rigid background check before giving any approval.
Since approval is fast, interest rate is higher compared to banks. However, if you have time to research and look for a better interest rate, it would be great. Though, lending companies target those people who don’t have the luxury to look for the best rates so they can dive to whatever these lending companies give them. There are lending companies that will not give you their interest rate over the phone or email, fortunately, Singapore has a financial blogger who gives out this information.
Lending companies do not care on what your credit standing is because they are more forgiving. But if you have outstanding loans from other lending companies, there are chances that you will get disapproved.