Responsible Licensed Moneylender in Singapore: Government Assistance schemes & Responsible Borrowing

Responsible Licensed Moneylender: Government Aid & Responsible Borrowing

The current Covid-19 has thrown the economy into a recession and lots of fear has crept into people. Not just on health concerns alone, but also on financial stability. In this article, we look into what is a responsible licensed moneylender and how we at Empire Global practise being a responsible licensed moneylender.

We will be diving into Singapore government assistance schemes that borrowers can consider first before taking up loans with financial institutions or responsible licensed moneylender.

Learn about Government Financial Assistance and Schemes

As the pandemic Covid-19 is behind everyone’s minds, we in Singapore do see drops in the recurrent cases. The pandemic has affected the livelihoods of many and not just employees but businesses and corporations have been greatly affected.

There are numerous financial assistance schemes available to help everyone tide through the Covid-19 crisis that has hit our homelands hard. We are going to introduce a few schemes that can best benefit you before considering to get a loan.

The Singapore government is fast to introduce several financial schemes to address the concerns of the public. For an overview of all the available schemes, check out on supportgowhere.gov.sg

The Temporary Relief Fund

Assistance: Immediate financial cash assistance of $500

Application Window: 1 Apr to 30 Apr 2020

Who can Apply

  • Singapore Citizens or Permanent Residents aged 16 years and above;
  • Was retrenched or suffered substantial loss of personal loss of personal income due to COVID-19 (at least 30%)*;
  • Had a gross monthly household income of ≤$10,000 or a gross monthly per capita income of ≤$3,100 before loss of job or income; and
  • Not currently a beneficiary of ComCare assistance *Loss of job/income must have taken place after 23 Jan 2020

Where to Apply: 

  • Social Service Offices (SSOs)
  • Community Centres/Clubs(CCs)
  • Online using Singpass at go.gov.sg/temporary-relief- fund

COVID-19 Support Grant

Assistance scheme provides: 

  • Monthly cash grant of $800, for 3 months
  • Job and training support by Workforce Singapore or the Employment and Employability Institute

Application Window: 1 May – 30 Sep 2020

Who can Apply 

  • Singapore Citizens or Permanent Residents aged 16 years and above;
  • Had a gross monthly household income of ≤$10,000 or a gross monthly per capita income of ≤$3,100 before loss of job or income;
  • Live in a property with annual value of ≤$21,000; and
  • Not currently a beneficiary of ComCare assistance

Where to Apply: 

  • Social Service Offices (SSOs)
  • Community Centres/Clubs(CCs)

The Courage Fund

Assistance: One-time lump sum payment of up to $1,000 (depending on household’s per capita income after being affected by COVID-19)

Application Window:

  • From 6 Apr 2020
  •  Applications should be made within 6 months from the end of the SHN, LOA, QO or discharge from hospitalization due to COVID-19 (whichever is later)

Who can Apply

  • Lower-income households (with at least one Singapore Citizen or Permanent Resident) whose family member(s) have contracted COVID-19 or are one Stay-Home Notice (SHN), Leave of Absence (LOA), or Home Quarantine Order (QO);
  • Had a completed or partial loss of household income due to COVID-19 (at least 10%); and
  • A household income of $3,900, or per capita household income of $1,350, prior to being affected by COVID-19.
  • ComCare clients may also apply.

Where to Apply: Social Service Offices (SSOs)

ComCare Interim Assistance

Assistance (depending on the situation of the household) may include:

  • Cash
  • Vouchers; and/or
  • Food rations

Application Window: Unrestricted
Who can Apply:

  • Singapore Citizen or Permanent Resident (at least one immediate family member in the same household must be a Singapore Citizen);
  • Need urgent and immediate help for less than 3 months; and
  • Have a household income of $1,900 and below, or a per capita household income of $650 and below
  • Where to Apply: Social Service Offices (SSOs)

ComCare Short-to-Medium Term Assistance

Assistance may include:

  • Monthly cash assistance
  • Assistance with household bills i.e. rental, utilities and/or service and conservancy charges
  • Medical assistance
  • Employment assistance such as job search and/or training
  • Referrals for other relevant services
  • Application Window: Unrestricted

Who can Apply:

  • Singapore Citizen or Permanent Resident (at least one immediate family member in the same household must be a Singapore Citizen);
  • Have little or no family support, savings, or assets to rely on for daily needs; and
  • Have a monthly household income of $1,900 and below or a per capita income of $650*
  • *If income exceeds these guidelines, individuals may still approach SSOs for assistance

Where to Apply: Social Service Offices (SSOs)

ComCare Long Term Assistance

Assistance (depending on the situation) may include:

  • Cash assistance
  • Additional assistance for school-going children
  • Secondary assistance (e.g. recurring essentials like medical or hygiene consumables)
  • Discretionary assistance (i.e. one-off essentials like medical equipment and household appliances)
  • Medical assistance
  • Education assistance
  • Supplementary community assistance (i.e. free or highly- subsidised access to social support services like home help and senior activity centres funded by the Government)

Application Window: Unrestricted
Who can Apply:

  • Singapore Citizen or Permanent Resident
  • Is unable to work due to old age, illness or disability;
  • Have little or no family support, savings or assets to rely on for daily needs;
  • Is an elderly person who receive only a small monthly payout from other sources (e.g. CPF Retirement Sum/CPF Life, Pension, ElderShield, etc.); and
  • Has children who are low-income themselves (i.e. household income of $1,900 and below, or per capita household income of $650 and below, and are unable to support their parents

Where to Apply: Social Service Offices (SSOs)

Responsible Borrowing from Responsible Licensed Moneylender

It actually takes both parties to come together and ensure that borrowing does not become a long term liability for both parties. The parties mentioned are the actual borrowers who are seeking short term loans, personal loans or even unsecured loans to either tide them over a tough time like the current Covid-19 pandemic or to ensure continuity in their business or lifestyles. Borrowers can also comprise those who are in sudden need of cash to pay for a service or solution, for example borrowers needing money to pay for their utility bills.

In such unprecedented times, businesses are unable to sustain their cash flow or their workers income as most of them see huge dips in sales and human traffic. Many are trying to tide over with their savings. Financial stability is on everybody’s minds as whether there will be a new form of circuit breakers or new measures to clamp down on the spread of infection.

It is now more than ever crucial to practise responsible borrowing as fear might just creep in and take over a borrower’s mindset.

What is Responsible Borrowing?

  1. Simply not borrowing more money that you can afford to pay back
  2. Understand different loan interest rates offered by different financial institutions or licensed moneylenders
  3. Choosing a loan scheme that caters to your loan needs
  4. Checking the duration of the loan. Longer loan term might have a smaller repayment. Short loan terms have larger repayment. A responsible borrower ensures that he/she borrowers at a comfortable level without hurting other financial commitments.
  5. Not missing out a repayment plan

Why borrow from a Responsible Licensed Moneylender?

  1. Borrow from a Licensed Moneylender. Firstly, always check whether the moneylender has a licensed. That’s rule number 1. A licensed moneylender has to be registered and such licenses are monitored heavily to ensure that licensed moneylender firms do not abuse their authority. For example, Empire Global is a licensed moneylender registered with the Insolvency & Public Trustee’s Office. (License No. 64/2017).
  2. If you are considering to apply for a personal loan, check that the licensed moneylender that you are approaching is approved by the Ministry of Law, and registered with the Insolvency & Public Trustee’s Office.
  3. Responsible licensed moneylender will advice on your loan scheme, loan term, loan needs according to your financial records. This prevents you from overborrowing leading that might lead to further liability. A responsible licensed moneylender will explain the loan terms and conditions to a potential borrower. All clauses are explained properly before a loan agreement is made.

If you are considering to apply for a personal loan, you should approach a licensed Moneylender approved by the Ministry of Law, and registered with the Insolvency & Public Trustee’s Office.

It is important to only borrow what you can repay.

You should consider these before applying for a loan from a licensed Moneylender:

  1. Never borrow to pay off another debt
  2. If you are unable to fulfill the contractual terms, the late payment and interest fees will be a financial strain not just on yourself, but also on your family
  3. Make sure you fully understand the terms of the contract, in particular, the repayment schedule, the interest rate charged, and fees applicable.

How do I know if a licensed moneylender is actually licensed?

Details of licensed moneylenders in Singapore are clearly detailed and updated regularly on the Registry of Moneylenders’ Ministry of Law website https://www.mlaw.gov.sg/content/rom/en.html

How much can I borrow?

Depending on your income, there are limits on how much you can borrow, and how much interest you can be charged.

We are Empire Global: Responsible Licensed Moneylender

As a responsible licensed moneylender, we build on initiatives by the government to create the best customer experience in the loan market. Our loan officers are professionally trained and ensure that borrowers are educated on the loan terms put forth. We provide responsible loan solutions that would benefit our clients. Empire Global is a licensed money lender and regulated by the Ministry of Law and is fully compliant with the Moneylender’s Act. We update our internal processes from time to time and keep up to the date with the latest underlying laws in the Registry of Moneylenders’ Ministry of Law website

Conclusion of Borrowing from Responsible Licensed Moneylender in Singapore

As with any commitments in life, do practise due diligence before committing to anything permanent. Such rules apply to taking out a loan. With new uptake of financial means through loans or money assistance schemes, it is your responsibility to practise mindful and responsible borrowing. To be a dutiful responsible borrower and for us at Empire Global to play a part in being a good responsible licensed moneylender.

 

Illegal Money Lending Activities in Singapore: Learn about remittance firms creating illegal loans

Illegal Money Lending Activities signs: Remittance firms offer loans

Illegal money lending activities seems to have another new scheme involved. This came in the form of remittance firms providing cash advances with interest to maids. 

Illegal Money Lending activities

Illegal money lending activities was seen in a remittance licensee, Toast Me, which was providing a special form of cash advance with interest to maids. In one contract, the firm charged a maid 10 per cent interest for a loan amount of $700. Only $630, was issued to her after a “first-time fee of $70” was deducted. However, this format of money lending can be considered illegal as it is exploiting a loophole in the regulation systems.  As the primary goal of remittance firms is to receive money and transmit it, as compared to lending money, which is the role of licensed moneylenders

A new prohibition against illegal money lending activities for remittance firms will be in place by Sept 10 to stop loan activities. The new prohibition will not affect existing loans, including restructured and refinancing loans. 

The rise in an increasing number of foreigners borrowing from licensed moneylenders, from 7,500 for the entirety of 2016 to 35,000 in just the first half of 2018.

It was mentioned by industry observers that it was unusual for remittance firms to be offering loans as the priority is to receive money for the purpose of transmitting it overseas but noted that some remittance firms might be exploiting the loophole since they are not licensed moneylenders under the oversight of the Ministry of Law. 

Loan caps and tighter regulations have been aimed at protecting foreigners who are living and working here in Singapore. However, this has led to some borrowers to turn to unlicensed moneylenders for sources of loans. 

The new prohibition notice was issued before the new Payment Services Act comes into force. In the upcoming Act, companies that are offering payment services such as remittance will not be allowed to grant loans to individuals. 

The current Payment Systems (Oversight) Act and the Money-changing and Remittance Business Act will both be revoked Payment Systems (Oversight) Act and the Money-changing and Remittance Businesses Act will both be repealed when the new legislation takes effect next year.

Pastor Billy Lee, executive director of Blessed Grace Social Services, was quoted to have received distress calls from maids with multiple debts and had handled 110 instances of such cases who had taken loans from Toast Me. Some had even lost their jobs here due to turning to illegal money lending activities and “Toast’s aggressive collection tactics”. Sending letters of demand addressed to their employers and harassment messages. 

He has urged the authority to stop such illegal money lending activities immediately “to prevent Toast me from aggressively advertising their credit facility to foreign domestic helpers who have reached their borrowing cap of $1,500 with the licensed moneylenders”

Illegal Money Lenders on Facebook

Are Licensed Money Lenders on Facebook Allowed to Advertise in Singapore? Be Careful!

Illegal Money Lenders on Facebook

Licensed Moneylending is a strict business in Singapore with various levels of restrictions for both online and offline presence. However, with the rise of digital media and the ease of digital advertisements, some moneylenders (illegal and legal) are turning to creative techniques to acquire more customers. Social media has made it an equal fighting ground for everyone. Illegal Money lenders on Facebook or unlawful lenders are now using social media to push creative new ways to attract customers.

Facebook Advertising Guidelines. No loan ads.

Facebook Ad Review Process

Facebook Ad Review Process

Facebook has 30 types of ad content that are not allowed (prohibited) to be advertised on Facebook. One, in particular, points out to the moneylending and finance industry.

“Payday Loans, Paycheck Advances, and Bail Bonds

Ads may not promote payday loans, paycheck advances, bail bonds, or any short-term loans intended to cover someone’s expenses until their next payday. Short term loan refers to a loan of 90 days or less.”

This strikes out as a strict advertising regulation for moneylenders, denoting payday loans and the likes of such are not allowed for money lenders on Facebook. Any forms of ads or sponsored content on Facebook for payday loans are not allowed on Facebook. Hence money lenders turn creative or get businesses to churn creative mediums for them.

Cloaking for Money Lenders on Facebook

This was a law raised in light of pressure to protect vulnerable users. Cloaking is a technique used by advertisers, spammers and companies to bypass the moderators and algorithms on Facebook.

Illegal Cloaking on Facebook - Infographics

Illegal Cloaking on Facebook – Infographics

A website or link is presented to the users that may appear legit, however, they are redirected to another version of the site or an illegal site to collect information. It may lead to misleading information on the website and taking up loans or financial products that might not seem favourable to them.

Companies like Facebook are trying hard now to protect their own users from harmful and deceptive financial products rather known as a “bad ad”. These bad ads can range from counterfeiting to phishing to promoting of illegal financial products, something that is not advertised.

Facebook algorithms are getting stricter and tighter, however, new creative ways of companies bypassing Facebook regulations are interesting.

The advertising regulation law for licensed money lender in Singapore

The Ministry of Law has a strict set of rules that governs a licensed Money Lender dos and donts in relation to marketing and advertising. These rules were set to ensure that the society at large is well protected and also due to the increasing negativism on the way financial products are being wrongly promoted.

What is not allowed:

Paid-for internet links

Paid-for internet links (also known as “sponsored links”) through search engines such as any paid-for links from search engines, appearing on internet search engine results pages or on any other Internet webpage.

This means that paid links on any online mediums are not allowed. Ads on Facebook are strictly not allowed in this case.

The Ministry Of Law has a set of rules that governs what a licensed Moneylender may or may not do in relation to marketing and advertising. Obviously, these rules were set in place for good reasons – to ensure that society is protected. We have extracted some of the key directions worth understanding.

Online advertisements that are not on the licensee’s business website or in an online business directory. Note: For the avoidance of doubt, advertising on internet social media sites (e.g. “Facebook”) or video hosting sites (e.g. “YouTube”) is not permitted.

This rule also adds on to the list that disallows online advertisements of social platforms.

Directories on online medium which consist solely of listings and advertisements of moneylenders and which are advertised in any manner or which are engineered in the same manner as described in paragraph

Advertisements in the form of Short Message Service (“SMS”) messages and e-mails sent to the general public, patrons of the licensee or former patrons of the licensee.

Still Bypassing Money Lender laws

However, even with tight restrictions by technology giants and by the local government laws, companies still find innovative ways to bypass such systems. One such technique is start-up companies try to cut into this space by offering a system to provide loan quotes to customers. These loan quotes serve as an offering to potential borrowers as they are gathered by various different companies. These companies are in the umbrella of the startup and not publicly known. This shields illegal money lenders on facebook or even legal money lenders that might resort to such techniques to acquire new customers.

Money Lender on Facebook to get Loan Quotes

Money Lender on Facebook to get Loan Quotes

Hence a word of caution, always check and be careful of what you might be in for. Read the fine print, and there’s be sure of the laws behind borrowing money. Also, ensure that you have a firm grip on your financials and spendings.

Money Lenders Regulations and outlook for 2019

Money Lenders Regulations and Outlook of Money Lending Industry 2019

Money Lenders Regulations

The fast-paced financial industry is Singapore has brought about several new changes to the Moneylending Industry here and introducing new money lenders regulations that is both benefiting to money lenders and borrowers.

Hearing from public outcry, the Ministry of Law introduced new loan interest rate caps. This ruling caps the interest rate of loans issued by lenders to be at 4 per cent monthly. This indirectly borrowers from over-borrowing and at the same time the borrowing cost that a moneylender can impost is now capped at 100 per cent of the loan principal.

Not only extending to locals, foreigners are also better protected now. An aggregate loan cap of $1,500 across money lenders is applied to foreigners earning less than $10,000 annually.

However, even with this ruling to protect borrowers, foreign domestic workers (FDW) are now lured into the borrowing game and think of it was quick and easy money. Some money lenders exploit the situation and charge the 4% on top of late repayment fees of $60 monthly. This amount of total repayment does not help FDW as they are unable to maintain their loans and lead to stealing from employers or even criminal activities.

New Business Models, New Money lenders, New Money Lenders Regulations

Late last year, new moneylending licenses were issued. This is a first in six years as a one-time lifting of the moratorium (imposed in 2012) as part of a pilot scheme in light to the new money lenders showing promise in better protecting borrowers through business-led improvements.

The new business models shows usage of data to assess creditworthiness of potential borrowers, digitizing their business processes to lower cost and provide better lending terms to borrowers.

New Loan Rules

Since Nov 30, 2018, the first phase of the Moneylenders (Amendment) Act 2018 and Moneylenders (Amendment) Rules 2018 kicked in, aggregate loan caps are set to limit the amount borrowers can borrow from all licensed moneylenders combined.

These new loan caps restrict Singapore citizens and permanent residents with an annual income of less than $20,00 to only borrow up to $3,000 from all moneylenders combined.

For foreigners, a lower aggregate loan cap of $1,500 is set to those earning less than $10,000 annually. If they are earning between $10,000 and $20,000 a year, they can borrow up to $3,000. For those who are earning at least $20,000, they can borrow up to six times their monthly income.

Regulatory Framework

A regulatory framework is now implemented, whereby licensed money lenders must obtain a borrower’s credit report from the Money Lenders Credit Bureau (MLCB) before granting any loan. This bureau is a central repository of data on borrowers’ loan and repayment records.

Accurate borrower information must be sent back to the bureau with timely updates when borrowers repay their loans.

Similar to the casino self-exclusion rule, there is now a rule to help borrowers regulate or curb their borrowing behaviour. They can opt for the self-exclusion framework and licensed money lenders are prohibited from lending to any individual.

What’s more for Money Lenders Regulations in 2019

The second phase of implementation is to professionalise the moneylending industry. This requires all licensed money lenders to be incorporated as companies limited by shares with minimum paid-up capital of $100,000 and to submit annual audited accounts to the Registry of Moneylenders.

Unlicensed moneylenders: Learn about harassment tactics and avoid them

Unlicensed Moneylenders New Harassment Tactics and How to Avoid Them

Unlicensed moneylenders a.k.a loan sharks have been keeping up with technology and equipping themselves with new harassment methods, which led to the Singapore Police Force issuing a new advisory on it last month.

Getting New Customers

It starts from how to recruit new borrowers — instead of printing flyers and going by word of mouth, loan sharks have started buying databases of numbers and sending WhatsApp messages to them, offering loans at low cost.

These loan sharks will often appear to be legitimate businesses through having a business name, phone number and even a website.

Simplifying the Borrowing Process

After securing your trust, the loan sharks also understands that they should simplify the borrowing process in order to onboard new customers.

So instead of meeting up and asking for your financial details, all they need are some personal details like a screenshot of your identification card, company name and address, SingPass login details and even where your children are studying.

(Note: This should raise alarms about the legitimacy of the business. Licensed moneylenders are not allowed to ask for your SingPass logins and other personal details like where your children are studying.)

First Incentivise, then Lie

In order to further convince you, they will first put up a repayment plan that seems reasonable, but over time, they will come up with excuses to change it and forces you to abide by the new change.

“At first, it could be monthly payments, but next week they would say: ‘Hey your payment is up’,” she said. When she told the moneylender of the original terms, the usual reply would be that the guy who gave it had gotten into an accident.” – As reported by CNA

The New Harassment Tactics

Finally, after you paid back your original debts, and some more, you realised that you still owed 5 times the original amount you borrowed.

And when you failed to pay that, harassment begins. While the previous methods of harassment such as splashing of paints and drawing graffitis on walls are still in used, loan sharks have begun using methods that inflict more emotional harm.

One such method is to send unsuspecting strangers to your house through various means.

They might place a large order with food delivery services such as McDonald’s or KFC and send them to your house. Or they might lure unsuspecting male subjects to your place by pretending that their “dates” live there.

Other more sinister methods include threatening to burn your home by sending you a video of burning homes or taking photos of where your children study.

Sounds scary right? Because it is. And the best way to avoid all of the above is to not approach unlicensed moneylenders at all, and do due diligence before borrowing from any sources.

In the police advisory, SPF encourages the public to avoid unlicensed moneylenders at all cost, and if necessary, approach licensed moneylenders that are listed on the Ministry of Law’s Registry of Moneylenders website at https://www.mlaw.gov.sg/content/rom/en/information-for-borrowers/list-of-licensed-moneylenders-in-singapore.html.

Licensed Moneylenders Loan - New limits and aggregate loan caps

Licensed Moneylenders Loan: New limits and stricter loan caps

Rules are always changing in the moneylending industry, and it is getting stricter each round. The latest rule, imposes a limit on the amount of licensed moneylenders loan that a person may borrow from. With rules changing and tightening the past two years, learn how the new rules is going to change the industry again.

As the public outcry for tighter control of licensed moneylenders and better protection for borrowers, the Ministry of Law (MinLaw) kicks in the first phrase of the Moneylenders (Amendment) Act 2018 and Moneylenders (Amendment) Rules 2018.

The first phrase of Moneylenders (Amendment) implementation calls for aggregate loan caps to be set to limit the amount borrowers (Singapore citizens, permanent residents and foreigners) can borrow from all licensed moneylender sources.

How new licensed moneylenders loan affects you

The new loan caps permits Singapore citizens and permanent resides with an annual income of less than $20,000 to borrow up to $3,000 only.

Whereas those who earn more than $20,000 a year may borrow up to six times their monthly income.

For foreigners, a lower aggregate loan cap of $1,500 for those who earn less than $10,000 annually. If foreigners are earning between $10,000 and $20,000 a year can borrow up to $3,000. Whereas those who earn at least $20,000 can borrow up to six times their monthly income.

New Regulatory Framework

The Moneylenders Credit Bureau will be implementing a regulatory framework whereby licensed moneylenders must obtain a borrower’s credit report from the bureau before granting any licensed moneylenders loan.

The new rules also allow for a self-exclusion framework that aims to help borrowers regulate their borrowing behavior and partake in debt assistance schemes.

Once an individual has applied for self-exclusion, licensed moneylenders are prohibited from lending to this individual.

In order to strengthen the regulation of licensed moneylenders, the law will now require licensed moneylenders to get the approval of the Registrar of Moneylenders before employing or engaging any assistance in the business. This means the loan officers whom are speaking to potential borrowers are fully qualified and vetted.

Not only employees, anyone that wants to be a substantial shareholder or increase his or her shares in a licensed moneylender, prior approval from the Registrar is needed.

The next phase of implementation will begin in early 2019, which includes professionalising the moneylender industry and requiring all licensed moneylenders to be fully incorporated as companies limited by shares with a minimum paid-up capital of $100,00 and to submit to annual audited accounts to the Registry of Moneylenders.

These new slew of laws are here to stay and will only get stricter. This serves great for both licensed moneylenders and borrowers. Lenders can now have better understanding of borrowers and borrowers will now be able to control their own financial well-being better.

Learn how to best review legal moneylender in Singapore

How to Best Review Moneylender in Singapore

Let’s recap on what to look for in a legal and reliable moneylender. We are going to list through several methods on how you can best review moneylender in Singapore, to provide you with good service and reasonable loan rates.

Quick Tips to best review moneylender in Singapore

There are several reasons why one would seek out a loan and there are several loan types to cater different needs. Hence regardless of the loan type (personal loan, payday loan or business loan), the licensed money lender is one of your best option in Singapore. Learn some quick tips on how to best review legal moneylenders.

1. Experience and years of service

Loan officers go through your loan application and request. They will aid you in identifying the best loan options to go through. They are also obliged to tell you all the terms in the loan such as length and number of repayments, interest rates of the loan. They will also understand and want you to borrow within your means as they still have to recover money from you.

This takes experience in servicing borrowers and also the business itself has been running long enough to understand the various changes that could occur in the moneylending industry and be up-to-date with it.

2. Licensed moneylenders will have you sign a contract

A formal contract is required by law for licensed moneylender with borrowers. The contract terms are drafted by a lawyer and contain the following:

Interest rates

  • Late repayment fees
  • Repayment period
  • Repayment amount
  • Legal terms

Hence it is vital to ensure that the loan officer guides and explains to you the terms of the contract before you sign. Never except a loan without fully understanding the terms. Some businesses are disguised as legal moneylenders but do not offer such contracts. Avoid them at all costs.

3. Approval Process. Do online checks.

More and more businesses are moving online. Convenience is vital to anyone now. Hence check out the moneylender online, read their website, their offerings and google reviews. Check out with them on the different loan options, do an online loan enquiry before heading down. Most legal moneylenders will reply quite promptly and accurately. The process is fast and you will not waste your time in heading down and be disappointed.

4. Check out Ministry of Law

The Ministry of law has a constantly updated list of licensed moneylenders. As licenses can be revoked due to ill business practises, it is good to check the most legal source of information.

Like shopping, you will compare the different offerings from different moneylenders. They will offer different interest rates so do look around and enquire to get the best loan options for yourself.

Learn from the Law Ministry’s guide to effective interest rates to understand how to make good comparisons between moneylenders.

Best Review Moneylender? Check on Google Reviews!

Looking for legit businesses? Like hunting for good food places, one has to check for reviews first. To best review moneylender, before heading down onsite, check on google reviews to seek out actual comments and reviews made by customers.

It’s a good place to identify legal moneylenders from the loansharks or illegal moneylenders and can be used as a comparison point between the other moneylenders that can be listed in google reviews.

How is the moneylender reliable?

One of the natural option to best review moneylender is to check the number of years that a business has been running is vital to identify its reliability and trustable. To be able withstand the ups and downs of financial crisis or economic slumps shows a business reliability and that customers see them through.

It also means that the business can tide through tough times and itself have to get a winning edge over others. Customers naturally trust them either through the years of running or the service that these companies provide.

A moneylender license is not easy to maintained. It is subject to checks on business practises, complaints and undergo stringent review by Singapore law. Licenses are limited and only businesses that provide proper legal loan services in Singapore can be issue such license.

Empire Global is always ready to serve and help our customers in getting the loans they require.

Major changes to moneylenders industry in 2017 and 2018

Major Changes to Moneylenders Industry 2017 and 2018

Loan Cap

One of the most impactful change would be the loan cap that moneylenders can dish out to borrowers. The current practice allows an individual licensed moneylender has a loan cap to each borrower, however, each borrower can borrow from multiple moneylenders.

The new practise proposed on Monday (Nov 6) in Parliament, was to impose an aggregate loan cap to each individual thus limiting the total amount that the borrower intends to borrow.

For example with the new loan cap in place, a borrower with an annual income of less than $20,000 may borrow up to $3,000 from all licensed moneylenders combine. For individuals with annual income of more than $20,000, they may borrow up to six times their monthly income from all money lenders.

For each borrower, before each loan is issued, it is now mandatory for money lenders to obtain credit reports from the Moneylenders Credit Bureau (MLCB) to check if a borrower has exceeded their loan cap limits.

These reports (50cents per report) are to be obtained online and money lenders have to update the Moneylenders Credit Bureau after each loan is issued.

Regulatory Framework for Moneylenders

A new regulatory framework will be established to allow MLCB to impose rules on money lenders to protect borrower data. This is to improve regulation of the industry.

With new rules, comes new changes in borrowers mentality. Ms Jolene Ong, chairman of Arise2care Community Services, which conducts debt counselling, mentioned that the new changes will prevent people from over-borrowing. However, for those in serial debt, they might just turn to unlicensed money lenders.

Regulation in Moneylenders Company Profile

Moneylenders must get the Registrar’s approval before employing or engaging any assistants. Approval must be sought before anyone can be a major shareholder or to increase shareholdings.

This new move is to allow the Registrar to cancel approvals for loan assistants or shareholders should they deemed as “unsavoury” or those with previous convictions in unlicensed moneylending.

Money lenders will then be required to be incorporated and submit annual audited accounts to the Registry for Moneylenders. This is to professionalise the industry and improve transparency and accountability. More than two-thirds of 160 existing licensed moneylenders have been registered as companies.

Empire Global a True Financing Center

Although the Bill has not been approved yet, with the new slew of upcoming potential changes, the loan and money lenders industry is set for disruption. We at Empire Global is pretty equipped to handle such disruption and are ever ready to serve our customers better.

Get the best guide to licensed moneylenders in Singapore

Complete Guide to Licensed Moneylenders in Singapore in 2016

We are counting down to the last weeks of 2016, and like every industry out there, it’s always good to do a recap on what has happened in this past year so as to keep everyone on the same page. On the new rules and regulations reminder on some of the pointers to look out for when borrowing from licensed moneylenders in Singapore.

The launch of Singapore Moneylender Credit Bureau in March 2016

This is one of the most important development for the year because finally, all the licensed moneylenders in Singapore would have access to a borrower’s past and current borrowing history. This is especially useful in identifying errant borrowers who are likely to default on their loans.

Most Licensed moneylender benefit from this new act, as they can now tap onto the information by the Moneylenders Credit Bureau to affirm their loan assessment.

This will curb excessive borrowing and “help debtors to keep their loan commitments at a more manageable level”, DP Info said.

“We’ll be able to know how much a borrower has borrowed from other moneylenders, so that we won’t over-extend the loan,” said Mr Peter Tan, vice-president of the Moneylender’s Association of Singapore.

We will be able to see the overall effect of this later when after we do a cover on the 4% interest rate cap.

Teenagers are Increasingly Being Lured to Take Part in Loansharking Activities in June 2016

Compared to the same period last year, there is an 600% increase of youth loanshark runners. This is due to several reasons such as new method of recruiting via social media. These advertisements are usually very vague on the job scope but promises high returns for a small amount of work.

After luring students in, they will then try to entice them to do the job by offering huge amount of cash.

This showed that while the licensed money lending industry is controlled by the government, the government still didn’t manage to completely weed out unlicensed moneylenders in Singapore.

Implementation of 4% Interest Rate Cap for Licensed Moneylenders in Singapore (July 2016)

July is the start of the gradual implementation of 4% interest rate for licensed moneylenders in Singapore.

Before this rule was implemented, there was no interest rate cap for borrowers earning more than $30,000 annually. This led to exorbitant interest rate of as high as 1000% per year by some erratic moneylenders.

With the new measures kicking in, licensed moneylenders in Singapore will be restricted to maximum rates. This include the new ruling that they cannot charge interest of more than 4 per cent per month plus this has to be on a reducing balance basis.

Should a borrower be late in his repayments, licensed moneylender can then charge a late interest, however this late interest must not exceed more than 4 per cent.

The limit extends to charges on late payments: A similar maximum interest rate of 4 per cent a month, while late fees will not exceed S$60 a month.

The total borrowing cost will be capped at 100 per cent of the original loan to keep debts from spiraling. Additional fees for, say, early loan redemption or unsuccessful GIRO deductions will not be allowed.

This has caused some repercussion within the industry, which we will see in the last pointer.

Reduced Debtor Loans Due to Cap on Interest Rate

Blessed Grace Social Service, an organisation that helps debtors to negotiate their borrowing deals, said that there has been a reduction in loan amounts since the introduction of the 4% cap — from $3-5k to about $1.5k on average.

The number of moneylender that one debtors owe also reduced from 10-15 to about 5-8.

This also led the moneylending industry to be more careful as they are more likely to make loses due to defaults because of the lower interest rate. Hence, some licensed moneylender in Singapore isn’t willing to lend to new customers due to the higher risk.

Johnny (not real name), a director of a licensed moneylending firm, said “I believe the loan sharks are benefiting from this because (for) the licensed moneylenders, nobody wants to give out loans to new customers,” he said.

To sum it off, 2016 has been a year of change, due to the implementation of new rules and regulations. Most of it has been set in place to help control debtor’s borrowing amount and borrowing ability.

But the restriction might have also start pushing some borrowers back to loan sharks and unlicensed moneylenders. So how do we find a balance between all of these in 2017? It will be something for the government to ponder on.

Pokemon Go Addiction similar to Over Borrowing Loans Addiction

Pokemon Go Addiction Equivalent to Over Borrowing Loans!

Caught Snorlax yet!? Pokemon Go has taken over the world! Literally. Since the launch of Pokemon Go in Singapore, you will see gamers of all ages swiping their phones “up” to catch their elusive Pokemons. Even aunties, uncles and grandmas are taking part.

There is a big revival of an age old gaming IP “Pokemon” and with Niantic leading the charge with Pokemon Go. However, despite the game’s popularity, it’s starting to draw flak with some members of the public and viewed as a nuisance game. Pokemon Go gamers or “addicts” are taking over parks and popular Pokestop areas. Hundreds gather a certain rest stop knownas a Pokestop to better their chances of getting rare Pokemons.

Caught the elusive Snorlax in Pokemon Go?

Caught the elusive Snorlax in Pokemon Go?

Pokemon Go Popularity

Even though the authorities have been called in to monitor the situation, there is nothing damaging with gathering and playing silently on their phones. Some gamers play way into the wee hours to catch their Pokemon and being glued on their screens. One might think that kids are the ones addicted to the new craze, but adults are jumping on the bandwagon in their quest to catch and train their Pokemons.

The game is ultra-fun and is really family friendly as one’s quest is to the collect Pokemon and at the same time, one is “forced” to walked around or explore new areas in town to catch Pokemon. The fast growing game has topped the Apple Store and Google Play Store and does not seem to drop the slightest bit. It has grown to be the number 1. game in almost all the countries it launched in.

The Bad side of Pokemon Go

The Pokemon Go addiction is very much akin and applicable to loan over borrowers. Addicted Pokemon Go players explore popular areas late into the night, affecting their studies or the adults have their work affected.

The constant vibration to hint on a nearby Pokemon location and urge to capture more Pokemons to level up or to increase their Pokedex numbers. Parents are seeing it as a worrying trend due to the nature of the game, which requires you to travel to hotspots to get rare Pokemons. These hotspots could have dangerous people who prey on kids and may seem normal in appearance.

How Pokemon Go Games is Equivalent to Over Borrowers

We at Empire Global have seen time and again, borrowers who borrow beyond what they can pay for or are repeat borrowers who even owe a large debt. Over borrowing can get dangerous, as the borrower might over estimate his repayment capability and incur large penalties resulting in longer repayments.
One of the reasons was that borrowers were using the loans to service their own lavish lifestyles, leading them to becoming repeat borrowers. Such addiction to maintaining their lifestyle is very much alike to addicted gamers who can’t leave their screens. Some Pokemon Go gamers go to the extent to hire chauffeur services to bring them to elusive spots in a bid to better their gaming abilities.
Several players are having their workloads affected as they play during their working or schooling hours thus affecting their usual routines. The resultant effect in terms of loans are when borrowers turn to loansharks when they are unable to curb their addiction. Many have turned into repeat borrowers whom are unable to sustain their loan repayments.

Know the problem. Understand your limits.

With every addiction, you need to first understand yourself and identity the problem. Know the problem. Quite often, borrowers who come in with money issues do not  know of their dire situation plus they didn’t seek proper help to address the problem. One needs to understand the limits especially when dealing with financial products such as personal loans or unsecured loans.

By borrowing beyond your limits, one would quite often fall into dire straits and seek borrowing from unlicensed lenders or even from their network of friends. This could further lead down to social and economic issues that affects not only the borrower but the people around him.