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Interest rate capped at 4% and many new regulations affecting moneylending industry in Singapore

Moneylending: Interest Capped at 4% per cent Monthly

The government has accepted new proposals on licensed moneylending, together with one of the biggest change amid protests which is the 4% interest rate cap per month.

The Government has accepted most of the recommendations put forth by an advisory committee and these changes will be implemented progressively starting from July this year (2015). And yes this news has caused quite a stir in the moneylending industry but we at Empire Global are well prepared for these changes.

With twelve of the 15 recommendations from the committee being accepted, the new changes has created some news amongst moneylenders. Two of the recommendations – to lift to lift the moratorium on the granting of new licenses and to regulate debt collection behaviour will be reviewed in time as the moneylending industry adapts to the new regulatory changes.

4 Per Cent Interest Rate Cap: How does it affect everyone?

In order to protect borrowers, the new ruling will place caps on interest rates. As of current rules, there is no cap on interest or late interest rates for borrowers earning more than S$30,000 annually. Some licensed moneylenders charge additional fees (e.g when GIRO repayments fail or dishonoured cheques are issued).

There is currently no restrictions on the total borrowing costs for moneylending loans.

With the new measures kicking in, licensed moneylenders 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 moneylenders can then charge a late interest, however this 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.

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

Furthermore, the total borrowing costs will not exceed 100 per cent of the principal loan sum which will prevent debts from getting out of control.

New Moneylending Regulations affecting Moneylenders?

Chairman of the Advisory Committee Manu Bhaskaran said data has been carefully studied to ensure that the industry remains commercially viable, even with the new caps.

“We completely accept that there will always be a class of distressed borrowers who will not be able to secure loans that they need urgently, from banks and other financial institutions,” he said. “So there is a role for a moneylending industry. And once you accept that, you must accept that you should allow them to have a decent return, taking into account the risk that they face, which is much higher.”

Although with the 4 per cent ruling, moneylenders will be allowed to charge an administrative fee up front, capped at 10 per cent of the original loan amount, for legitimate costs such as securing credit reports.

With regard to borrowers earning more than S$20,000 annually, the new rules will cap their loans at six times their salary from all licensed moneylenders. Such borrowers can currently take a loan of up to four times their monthly salary from each moneylender.

What’s Not Including in the Recommendations?

The government did not accept a recommendation that moneylenders be allowed to advertise in newspapers using strict templates, taking the view that advertising could lead to increased borrowing.

Moving Forward

Stiffer Rules on moneylending to be rolled out

Stiffer Rules on moneylending to be rolled out. Photo credit: Straits Times

A new Moneylenders Credit Bureau will also provide a centralised, comprehensive database of borrowers who use licensed moneylending services.

“We set up this committee to come up with recommendations that would help protect the consumer, the borrower. But at the same time, if you kill off the moneylending industry, then the people who need to borrow won’t get access,” Mr K Shanmugan, Minister for Law and Foreign Affairs said. He further mentioned that the new recommendations are centred on how best to balance both.

The 4% interest rate caps would be the first of a list of proposals recommended by the committee to be rolled out within a month by the Law Ministry.

Mr Manu Bhaskaran, director of Centennial Group International and chairman of the committee said, that the committee has decided to accept the moneylenders’ recommendations to help them cover their administration costs incurred in giving out the loans and late payments from borrowers.

More References: TODAY reports on moneylending interest rate cap

Harassed online by Loansharks? Use licensed moneylenders instead!

Harassed by Loansharks ‘大耳窿’? Use Licensed Moneylender!

The digital age has certainly changed the way business is done. And the illegal moneylender (loansharks) have taken it to new heights. We at Empire Global take a look at how the industry is changing rapidly.

Harassment Online: Name Shaming

Loansharks are now using social media to take their “Owe$Pay$” threats online. One creates a fake account that replicates the borrower’s with similar name and befriends everyone that he knows. And then the big hit comes whereby the loanshark starts placing posts on the account.

They even use postcards with pictures of the victim’s identity card, plastered with O$P$ and plastered them onto the fake account. This is just one such antic being used by them.

By name shaming and cyber bullying the borrower, the unlicensed moneylender gets to publicly let the victim’s closest ones know about his borrowing issue.

Help Yourself from Illegal Moneylender

Firstly, the law is on your side in an online bullying case. Facebook complaints falls the Protection from Harassment Act (POHA) because he had claimed the content on Facebook was false.

Secondly, under the Moneylenders Act, any person who, acting on behalf of an unlicensed moneylender, commits or attempts to use any threatening, abusive or insulting words, behaviour, writing, sign or visible representation, or commits any act likely to cause alarm or annoyance to his borrower or surety, any member of the family of the borrower or surety, or any other person, may face up to five years in jail, a fine between $5,000 and $50,000 and is also liable to get caned.

With the police clamping hard on harassment cases coupled with the use of modern technology plus social media, the police have come up with alternatives to get the public at large to help them.

Posting images of loanshark harassment, with their deeds online, the police appeals to the public to turn n such offenders. Such as Liu Yimin Lynnette, 28, who was charged in court facing seven charges of splashing red paint on doors and pasting envelopes with “O$P$”, the unit numbers of the borrowers, and a mobile number on the walls beside the units.

The young woman (above) whom the police were looking for in relation to loanshark harassment has been charged in court. -- PHOTO: SINGAPORE POLICE FORCE

The young woman (above) whom the police were looking for in relation to loanshark harassment has been charged in court. — PHOTO: SINGAPORE POLICE FORCE

News publishers such as AsiaOne has taken this another step further by showing a map of the money harassment cases (Loanshark Harassment Hotspots) occurring in Singapore. These are public information gathered from SPH news sources to give the public a better look at the harassment cases by illegal moneylenders.

Borrow from Licensed Moneylender Instead

Simply avoid all these harassments that could ruin your name by going to proper licensed moneylenders instead. There are limited licensed moneylenders and every year it becomes harder for businesses like us to maintain the moneylender license.

This is due to changing policies that improves the safety nets of borrowers. We encourage these moves by the government no doubt as it makes things smoother for us.

With strict regulations by the government and heavy punishments for licensed moneylenders if they made offences. Hence borrowing from licensed moneylenders make a better choice.

Negotiations between lending officers becomes easier too. Tell us your concerns and we can help you.

Interest Rates Take a Hike with rising Sibor in Singapore. Look at how it will affect you.

Interest Rate Spikes & Latest in Moneylenders News

Money, money and more money! The recent news about the US interest rates hikes has hit our shores in Singapore and the news is not entirely encouraging.

The three-month Sibor, which is used to price most loans and mortgages here, has been inching its way upwards due to interest rate hike in the United States and a weakening Singapore dollar versus the greenback. The recent announcements by MAS to reduce the Singapore dollar from appreciating aims to keep the Sibor elevated.

The Sibor is fixed daily by the Association of Banks in Singapore based on quotes from banks on what they expect to pay for interbank loans that day. In short, it is affected by liquidity in the banking sector.

“The reduction of the appreciation slope could keep pressure on the US and Singapore dollar exchange rate and thus could ensure Sibor remains at current levels … This move by MAS helps keep Singapore policy on a stable footing, and we expect it to be modestly beneficial for Singapore bank earnings,” analysts from Morgan Stanley said in a research note.

Interest Rate Hike: What does it mean for You?

Many housing loans offered by banks are tied to three-month Sibor. Oversea-Chinese Banking Corp (OCBC), for example, has 3 types of home loans and one that is currently offering home loans at three-month Sibor plus 0.85 percentage points for the first three years, according to its website. Lending rates are reviewed every three months. As the Sibor is set to increase, so will the interest rate rise. Home owners will eventually face higher mortgage payments.

“We had expected the bullish move in the SOR and Sibor since last year,” says UOB economist Francis Tan (source)

Analysts are looking at further upside to about 1 to 1.2 per cent at the end of the year. Effectively leading to an interest rate of about over 2% for home loans.

Let us assume an outstanding housing loan of S$500,000 and 20 years remaining. With the current interest rate of 1.5 per cent, this works out to a monthly payment of about S$2,410.

If the interest rate is increased to 2 per cent, the monthly payment would rise to around S$2,530. Should the rate rise to 3 per cent, the monthly payment would be S$2,770.

What to Do Next with Higher Interest Rate?

Higher interest rates charged by banks affect your loans directly. Thus you will see your loans, home mortgage loans, renovation loans slowly inching its way up.

Hence start reviewing your loans! For example, review your home loan packages every two to three years. Look at the trends Conventional wisdom has it that you should review your loan package every two to three years, or before the promotional period ends and your bank raises its premium on the interest you pay, which increases your monthly instalments.

In short, think long term and look around for good deals. Always negotiate with the bank on refinancing options.

Latest in Moneylending Industry Singapore

DPM Teo added that the improved situation was due to the tough laws enacted, strong enforcement efforts against loan-shark syndicates and the high level of community support in the fight against unlicensed moneylending activities.

According to DPM Teo, about 1,900 people were arrested for unlicensed moneylending and related harassment offences on average yearly between 2011 and 2014, while about 2,600 were convicted in court for these offences.

Debt Collectors in Singapore creating a fuss & harrassment at Funan Digital Mall Singapore

Debt Collectors in Singapore creating a fuss & harrassment at Funan Digital Mall Singapore

Seen the recent hype about public harassment during working hours? Debt collectors created a ruckus at Funan Mall over unpaid debts. Moreover, this was during working hours infront of the public eye.

With clamping down on unlicensed activities and harassment cases, this is looking good for us licensed moneylenders at Empire Global. The image of licensed lenders is changing for the better as tougher laws are weeding out bad lenders. Thankfully, the ruly debt collectors have been arrested for unlawful assembly.

Sources
http://business.asiaone.com/news/what-do-about-home-loan-interest-rates-rise
http://www.straitstimes.com/news/singapore/courts-crime/story/debt-collectors-who-created-scene-funan-mall-foodcourt-arrested-po?page=15

Unsecured Borrowing Changes: Why You Should Be Aware

Unsecured Borrowing Changes: Why You Should Be Aware

Singapore – As the nation progresses aggressively and competes against the other countries, there are now an increasing number of new borrowers in the market. This has led to several changes in credit lending rules in the past years and there is are new regulations to look at. More borrowers are exceeding their unsecured debt limits and over borrowing past their financial limits.

Consumer credit trends have stabilised and is in a healthy state, although some borrowers have over-extended themselves. Let us at Empire Global explain further on how individuals are affected.

According the the Monetary Authority of Singapore (MAS), about 3% of unsecured borrowers are in unsecured debts that exceeds their annual incomes. Unsecured debt is money owed that is not tied to any assets, in contrast to secured debt such as housing and car loans. Examples include credit card debt and personal loans.

This prompted the Credit Counselling Singapore (CCS) to look into cutting borrowers debts by offering a centralised repayment solution. CCS will roll out a centralised repayment solution to help borrowers coordinate negotiations across financial institutions and work out a repayment plan.

The plan will take into account a the borrower’s background such as borrower’s income, expenditure, needs and loan obligations. All the leading retail banks have agreed to get on board with the new system by the first quarter of next year. For moneylenders, borrowers are highly encourage to speak to the loan officers to negotiate a suitable loan contract between themselves.

As A Borrower?

Saving Yourself From Unsecured Debt

Saving Yourself From Unsecured Debt. New Unsecured Rules to aid borrowers.

Starting from June next year, borrowers will be barred from getting additional credit if their debt exceeds their annual income for three straight months.

With major crackdowns on illegal lending and moneylenders providing bad practises, the various agencies are clamping down hard on offenders. The police in August released its Mid-Year Crime Brief, which revealed that there were 3,235 cases of unlicensed moneylending reported in the first six months of this year. This was down 31.6 per cent from the 4,729 cases reported over the same period last year.

Furthermore, social safeguards such as the continuous crackdown on illegal moneylenders are taking place. There’s many of such lenders providing bad advice and hidden rules + charges that are disallowed by the government.

This is why we at Empire Global strongly emphasize the importance of understanding the terms of borrowing and letting customers know about it. We do not engage in forcing borrowers to sign but instead tell them the best way forward for them.

This is why we value our financial loan officers very much and also why as a borrower you should go only to licensed moneylenders. Always practise financial prudence.

What’s New for Unsecured Lending?

As mentioned before, the advisory committee for moneylenders have now come up with suggestions stating that the total amount that a person can borrow would be just four times the amount of their monthly salary.

Loans for borrowers earning below $20,000 a year will be capped at $3,000. Interest rates are also expected to be changed, as the committee suggest it to be capped at four percent a month. These are actually great news for all borrowers as they are strict rules which prevents moneylenders from illegally charging more than the norm. Least now there’s would be a standard across the board.

Read about what the new Advisory Committee has to say about unsecured loans

Our Advise for Getting Unsecured Loans?

Be smart. Maximise your money by making smart financial decisions. Try to cut your debts quickly and borrow wisely. Only when you need it especially for life emergencies. Learn about the various loan offering available (payday loan, personal loan, unsecured loan, bank loans, etc). Choose on that best suits your financial needs and do not over borrow. Borrow only what you really need.

Should you need credit advise from official channels, you can contact the Credit Counselling Department and they will guide you through. If you need loan advice or how to properly plan the credit you need, you can also contact us at Empire Global and our loan officers will best advise you.

More reading articles
Personal Data Protection Act : How it affects you. Take action Today!

PDPA Personal Data Protection Act Singapore Affects You

What’s is the big fuzz about PDPA?

With a rising spate of complaints over telemarketers “harassing” people with the phone calls or text messages, the Government of Singapore has further looked into the matter and emphasised heavily on personal protection with the introduction of the PDPA policy. This is designed to safeguard an individual’s personal data against misuse. It comprises of the recently introduced national Do-Not-Call registry and a new enforcement agency that is tasked to regulate the management of personal data by businesses and impose penalties.

Personal Data defined

Personal Data Protection Act PDPA

Personal Data Protection Act PDPA. Be aware of your rights!

Personal data refers to data regardless of truth, about an individual who can be identified from the data. Unique information (e.g. NRIC number, passport number) as well as other relevant information (address, age, name,telephone number) about the individual. The act allows individuals more control over their personal data, since prior consent has to be given and they would need to be informed of the purpose of information collected.

PDPA is implemented in phrases to allow businesses to accommodate their processes to it. The introduction of the Do Not Call (DNC) Registry started in 2 Jan 2014 and was followed up with the personal data protection on 2 July 2014. You might have noticed in the news that companies are being fined or penalised with regards to the DNC or PDPA rulings. Well, we at Empire Global had complied way much earlier than those dates.

Personal Data Protection Act: The Whole Idea

1. Tackle Issue of Unsolicited Telemarketing Calls & Messages

The national Do-Not-Call (DNC) Registry created early 2014, prohibits organisations in Singapore to send specified messages to any Singapore number registered with the DNC, unless prior consent was given. If any company is caught violating the data protection rule or are non-compliant, they would be fine heavily.

2. Enhance Country Competitiveness

With the introduction of the PDPA, the new data protection law is poised to strength the nation’s position as a trusted business hub. You would not want companies “harassing” you right? Which is why Empire Global focuses primarily on financial education instead of hard-selling you.

3. Data Protection Commission (DPC)

The DPC team has the power to initiate investigations and/or conduct enquires on companies. They are able to direct non-complying companies to be fined up to SGD$1million.

4. National Do Not Call Registry

With the newly setup registry, individuals can now opt-out of receiving marketing messages in form of phone calls, short message service (SMS) messages, multimedia message service (MMS) messages or fax messages. It is now an offence for organisations to send messages registered under the “Do Not Call Registry”. Such offences are punishable by a maximum fine of SGD$10,000.

Read more about Do-Not-Call DNC Registry: Are you on DNC yet?

Lodge complaints About a DNC Offence

In short, What’s in it for you?

As a consumer you are protected by the PDPA. PDPA prohibits organisations from collecting, using or disclosing personal data about an individual unless prior consent is given for such collection or disclosure was made. Organisations can only collect information for reasonable purposes.

The moneylending industry is extremely competitive.  The introduction of PDPA and the DNC registry, we have seen some known moneylenders getting hefty fines or licenses revoked. The practise of getting and tempting customers through phone calls and messages have went down a lot, marketers of such lending schemes are desperately finding new ways to find new customers.

So if you are borrowing in future, do be careful of unknown messages that come to you promising low interest rates or quick schemes. Always always, read before you sign anything. That’s rule no.1 for us at Empire Global.

Main Data Protection Obligations of the PDPA

  • Notification – Individual must be notified about collection, usage and disclosure of personal data.
  • Consent – Consent of individual is important to collect, use or disclose their personal data
  • Retention Limitation – Requires organisation to remove all personal data when the campaign has ended officially.
  • Openness – Organisation must be transparent with the information about your data protection polices, practices and complaint process available on request.
  • Purpose Limitation – This restrict the individual data to be used for a particular product or services that is agreed upon.
  • Transfer Limitation – Personal data is transferrable to another country only if the requirement prescribed is under the regulation.
  • Access & Correction Accuracy – This allows individual to access and edit all information which their personal data is used.
  • Accuracy – Personal data must be validated before proceeding with any campaigns.
  • Protection – Protection of personal data must be done by having security arrangement within organisation and external parties that will be handling your data.

More reading sources

Register with DNC – www.dnc.gov.sg
For more information about the Act, visit the Personal Data Protection Commission website.
Problem Gambling & Considerations in Getting Personal Loans

Problem Gambling and Considerations in getting a Personal Loan

Think World Cup makes you Rich?  A look at Problem Gambling

Seen the problem gambling advertisement by Singapore? It has gone completely viral and people from the USA has seen the ad. Most of us at Empire Global are glad we supported Germany! Some of us have won quite a bit. Of course we bet from licensed source – Singapore Pools.

And who could forget dynamo Germany win over Argentina in the World Cup finals! 1-0 and that sealed the deal for the campaign.

We wished this was us! Gutsy guy who made this pick. Well, the ad message is to get across “Problem Gambling” to people.
Any Other Score: Germany vs Brazil

Any Other Score: Germany vs Brazil. We all wished we had this betting slip! 7-1 to Germany.

Here’s the ad done to resolve problem gambling

Problem Gambling in Singapore

We probably should have heeded Andy’s dad advice to support Germany isn’t it? With Germany’s win over Brazil (7-1 trashing), our hearts wished we had bet big on Germany. Wouldn’t you?

Although the memes and the jokes that people made over the ad made Singapore famous indirectly but the underlying message is important. Which is why the government agency will not yank the advert out from our tv viewing commercials.

Problem gambling is on the rise here in Singapore and is getting prevalent in our society especially with two big casinos in our country. Public education has increased greatly over the years, with readily available helplines , exclusion acts from casinos  and many online resources and support from government agencies. Here’s an info graphic to show some numbers on gambling habits in Singapore.

Gambling Figures 2011: Highlighting Gambling habits of Singaporeans

Gambling Figures 2011: Highlighting Gambling habits of Singaporeans. credit: ST PHOTO

With the increase takedown on illegal gambling dens and illegal moneylenders, it shows that Singapore is taking a strong stand on illegal activities.

Read more on: Singapore cracks down on illegal gambling dens

Borrowing Legally and Illegally

With World Cup this year, moneylenders has seen a spike in customers who are borrowing. Some of them had gambled heavily on underground gambling dens and needed financial assistance immediately. Some had turned to loansharks to borrow to pay off their debts. We speak to such customers every so often and at times we had to turn them down too.

The benefits and low risks involved for borrowing from legal lenders far outweigh those of illegal lenders. Harassments, high interest rates, SMS spam are the things you would want to avoid when you want to take up a loan.

Read more on: Why borrow from Licensed Moneylenders

Financial institutions and legal moneylenders have regulatory compliances and legit licenses to provide personal loan. Furthermore, with Budget 2014 there are new changes to the moneylending industries. Tighter rules and regulations are being carried out with more crackdowns on moneylenders who fail to compile within the rules. Moneylending licenses are getting lesser too. Which means those licensed moneylenders you see now are pretty much doing a great job.

Moneylending rules are under review which was announced during the World Cup period. Borrowers would have better financial education and interest rate caps. We expect this will be done across the board soon and the stop to new licenses for moneylenders since 2012 goes only to show that the government would only want good moneylenders to remain in the industry

Read more on: Moneylending review this World Cup

Getting a Personal Loan

You may need a sum of money urgently and you have exhausted all avenues to look for. This is when people turn to licensed moneylenders as it offers a form of unsecured debt financing solution. A Personal loan might be a good choice to look at. Plus moneylenders are able to release funds on a shorter term notice.

Advantages of Personal Loan from Moneylenders

Personal loan issued by moneylenders are unsecured meaning that you don’t have to vouch so strictly for your credit rating or income as opposed to by banks and other financial agencies. However by saying so, ensure that you are borrowing from a licensed moneylender or else you might end up in debt with extremely high interest rates.

Most of the time, one will need to handle a stack of paper work and provide assurance to lenders in order to receive a personal loans. Whereas with moneylenders, this step is greatly simplified. You would not need to have  a perfect credit rating or high salary to cover the personal loan.

Read more: Personal Loans Information Guide

5 Important Considerations before getting Personal Loan

1. Have you thought of all other alternatives before approaching a licensed moneylender? Do you have reserve funds somewhere? This is because personal loans bring another form of debt towards your financials.

2. Personal loan contracts are legal and borrowers are to ensure that they are able to meet the repayment terms and contract requirements. Ensure that you are able to meet the repayments set out and double check in on your financials before signing on the contract.

3. Borrow only what you need and what you can repay. Do a financial calculation of your outstanding debts, income and expenses. Gauge your debt servicing ratio, and borrow only what you can mange with. This is to avoid unwanted interest repayments.

4. Ensure that moneylenders or financial officers explain the financial and legal terms that are bounded in the contract. ALWAYS be sure that you know and understand the personal loan contract term. For personal loans, keep in mind the basics which is repayment period, repayment schedule, interest rates and other fees that could be incurred.

5. Be sure of yourself that you have made an informed decision about taking a personal loan from a licensed moneylender. Go with a licensed moneylender that you are comfortable with. Check their reviews online and compare them. Do not rush to take up a personal loan. Do through research for yourself.

At the End of the day

Regardless of whether you are borrowing from banks or licensed moneylenders, ensure that you have done adequate research and comparison on the loan contracts.

Personal loan are contracts made between you and the lender, understand the legal terms and the repayment contract that is set out. Caculate the interest rates and the repayment amount for the full loan term to ensure that you are borrowing within your limits.

ALWAYS borrow within your capabilities.

Stay tuned as we bring more articles on personal loans and how it affects you. We look into interest rates offered by banks and the many financial terms and buzz words commonly exchanged between them to confuse borrowers.

Empire Global is a licensed money lending company in Singapore. We place great emphasis on dishing out proper financial advice to our customers before they sign on the dotted line.

Here’s the new ad done by NCPG to save themselves. Some find it a good one. Some not so. You have the final say.

NCPG new Ad One More Time for Andy's Dad

NCPG new Ad One More Time for Andy’s Dad after Germany’s win this World Cup. What say you?

Don't Be a Victim. Learn about these four financial scams today.

Don’t Be A Victim! Learn About These Financial Scams

We had previously talked about 7 great tips you can use to identify legal and illegal moneylenders. Read it if you haven’t, as it might just save you from heaps of troubles.

We at Empire Global greatly enforce the rules stipulated by IPTO and our loan officers always advise our customers on the proper loan terms.

A reminder, legal and licensed moneylenders do not send out SMS marketing messages. If you ever received one, it MUST be from an illegal source. But unfortunately illegal moneylenders aren’t the only problems that borrowers face nowadays.

There are always unscrupulous businessman and scammers who constantly think of new ways to trick you off your hard-earned cash. These usually come in the form of financial scams that are carefully disguised as legitimate businesses deals or easy cash. Falling into any one of these could mean landing yourself in huge debt or seeing your savings wiped clean.

4 Common Types of Financial Scams

Now let me quickly take you through these 4 most common type of financial scams and how to identify them with a help of a great educational video.

Ponzi Scam

Ponzi scams almost always lured victims with high short-term returns with low to zero risk, but things aren’t as good as it seems. Often victims will receive about 1-2 prompt returns on their investments (as advertised), but that’s as far as it goes.

The greatest Ponzi scam in Singapore was Sunshine Empire masking as a MLM business that promises extremely high returns. Lots of people around us at Empire Global had been duped by them.

Once the victims are convinced and hooked into investing more of their money, the scammer starts to disappear and becomes uncontactable.

Thus always remember the saying, “there is no free lunch in this world”. If the investment sounds too good to be true, or encountered such an attractive deal, do a research online (forums, news, government website) to prevent falling into such traps yourself.

Lottery winnings / Inheritance Financial Scams

These are one of the oldest scam out there. Typical a scammer will contact you about a huge windfall either through winning some lottery or inheritance.

These usually come in the form of an email/mail (usually very well written!), with proper letterheads, and promoting it as risk-free. This is to give you the perception that it comes from a legitimate source.

Once you bite onto the good news, they will then slowly bait you into transferring money as a “processing fee” or “handling fee” in order for them to transfer the winnings to you.

Phishing Scam

Phishing scams refers to scammers trying to impersonate as an existing legitimate business or government body to try to get your personal particulars or passwords etc.

Common ones are these online login website to your bank accounts. They develop a login website similar to those of the banks and trick you into keying in your personal data and passwords into the online form.

Hence, always ensure that the Bank login website that you are visiting is the correct and legit ones. Always check with the bank if you are unsure.

Illegal Moneylenders Scam

Today, we are also going to highlight another new financial scams scheme use by the illegal moneylenders in Singapore. If you think they only use SMS marketing to fake as legal licensed moneylender in their SMS message? You are wrong! They are more than just fake SMS marketing as licensed moneylenders.

In fact, there are even reported cases of scammers sending threatening SMS to their victims demanding for money that they have allegedly borrowed or payments that they have missed.

Read more on Watch Out! Illegal Moneylenders and the Ah Long Scams

What really forces the victims to comply is the scammer ability to identify them by their names and NRIC number. Which is then followed by a threat to the victim’s family members.

Once successful, the scammer will then instruct the victim to pay the money within an hour or less to a bank account. This is to prevent them from having the time to go seek for advice or help from other inclusive of the Police.

However, since the rise of such cases, the Singapore Police Force came out with some guidelines highlighted below that can help you avoid such financial scams.

  • Do not contact the senders of dubious messages or letters
  • Do not response to unsolicited demand for loan payments
  • Do not reveal your personal particulars such as Name, NRIC number, and address to unknown individuals
  • And always report to the police when such incidents happen.

You may just save you your hard earned cash and the agony of dealing with such incidents.

Here we are also sharing an infographic about financial scams around the World! Arm yourself and your families with this knowledge and prevent these from happening to you!

Infographic - Learn about financial Scams  happening around the world

Infographic – Learn about financial Scams happening around the world

Credit Card Payment on Credit

6 Tips to help you Manage Debts & Finances

According to an article published on The Straits Times on 1 August 2013, Singaporeans are loading up more and more on debts and many are taking up multiple loans.

This is also made evident in the Yearbook of Statistics Singapore 2013; it shows that the number of pledges received at pawnshops and the numbers of loans have shot up significantly between the years 2011-2013. Obviously, this has shown that Singaporeans may have difficulty in managing debts and require help to manage debts.

As it’s becoming easier to apply for credit options such as credit cards, credit lines and loans, the number of young adults running into debts are increasing as well.

6 Tips to Manage Debts Better

So how should you ensure that you don’t end up being buried under a mountain of debt?

Here is a simple video by Institute of Financial Literarcy that shows us how you can learn to manage debts, and some take-away pointers from us at Empire Global SG.

1.) Don’t take up loans that you Cannot Afford

Before you get too excited about taking up a loan for your new Porsche or Ferrari, please bear this in mind – higher debts equals higher repayment terms which leads to lesser ready cash for your other expenses.

As a general rule of thumb, your total monthly servicable should not exceed 35% of your gross income. This is to ensure that you will be able to repay the loan with ease and not create a pit-hole for your future.

2.) Be interested in interest rates

Is it true that you should take a package with a lower interest rate? If you agree with that statement, you are probably paying more interest than necessary.

Effective interest rates reflect the true cost of taking up the loan as it takes into consideration the frequency and amount of the repayments.

This could means that although you are servicing a smaller amount of monthly repayments but you are actually paying more than one who pays a larger monthly amount.

Advertised interest rates on the other hand, are typically nominal rates, which have not taken the amount of loan and period of repayment into consideration.

Therefore, next time when you are offer an attractive loan rate, do not be too hasty to take up yet.

Ask the bank for the effective interest rates as well; calculate the exact amount that you need to repay after taking into consideration the amount of loan and the frequency of repayments before you decide whether to take up the loan.

Hence, if you are keen to manage debts, make sure you have adequate knowledge in the different interest rates and be very clear of what you are landing yourself into!

3.) Read Everything before signing anything

Unless you are a superstar who needs to autograph for 5000 fans within 2 hours, take time to study the contract carefully. Understand your rights and obligations before you sign.

If in doubt, question every term and jargon that you don’t understand. Know that you are the customer and have the right to know every detail thoroughly from the service providers.

Once you have signed on the contract, you are legally bound to the terms and conditions stated.

To manage debts well, do not make the common mistake that most people do when taking up a loan deal. Not reading the fine print!

4.) Don’t Borrow to Pay a Debt. Ever.

We cannot stress on this point any further – Never Ever Borrow to Pay a Debt. Do this in order to manage debts better!

If you need to borrow to pay for a debt, it shows that you are already having problems to manage debts.

Stop before you dig yourself into another hole! Look at some of the Stupidest Ways Singaporeans Deal With Debts and don’t follow in their footsteps.

If you think you can manage debts yourself, by doing so, you are totally wrong. Wouldn’t it be worse to have one more debtor coming after you for repayment?

Here are some steps from MoneySense to help you understand how you can become debt-free as soon as possible.

Credit Card Payment on Credit

Credit Card Payment on Credit Card Joke

 

5.) Stay on track with the big picture

Are you getting confused over the different debts that you have? Are you unsure of what debts you are paying for every month and when are the repayments going to end?

To manage debts well, come up with a spreadsheet to have a better overview of the outstanding debts. It will also help you to prioritise which debt you should repay first.

As a general rule, you should always pay off the debt with the highest interest rates such as credit card debts.

This helpful infographic will show you 5 tips to save yourself from the credit card debts.

5 Ways Dig Yourself Out of Credit Card Debt Info graphic. Manage Debts better!

5 Ways Dig Yourself Out of Credit Card Debt Info graphic. Manage Debts better!

 

6.) Consolidate and save

Are you suffocating from the different debts that you need to repay every month? Perhaps it’s time for you to speak to your lender on the repayment terms.

Trust us; the situation will just get worse if you try to avoid payments. Have a good control over your financial situation; ensure that you do not have too many late repayments to prevent incurring more interest.

Your lender may be able to help you to restructure the loan. After all, all lenders would want their money back.

Don’t try to avoid your lender just because you are having problems with the repayments. Be open to them. Ask for help.

Conclusion

At the end of the day, the best way to prevent you from getting unhealthy with debts is to be able to manage  debts well. Understanding your needs and wants, be able to differentiate between the two.

Focus on your priorities in life. Understand your needs and reduce on your wants, you will naturally be able to reduce your debts.

Before taking up a loan or swiping your credit cards for your next purchases. You should look at your monthly income, expenses and budget them accordingly.

Do you have the capability to support that new purchase? Ask yourself the questions before committing.

Spending more than you Earn

Spending more than you Earn

 

Therefore, as much as possible, we should try our best to manage debts before it gone badly and enjoy our lives within our own means.

If you can only remember one point, just remember this – Spend within your limits and plan wisely. Speak to the friendly loan officers at Empire Global SG for advice and assistance if you need further information.

Managing Debt in Singapore

In our fast-paced society and growing needs, it has become a stage whereby most people would have debts. Be it a home loan, mortgage, personal loan, car loan or credit card bills. Most importantly, one should pay off one’s debt as soon as possible to avoid incurring unknown expenses. It will save you lots of hassle and money in the future.

It is important to understand that getting into debt is a major responsibility. Too much debt can easily get us into trouble. Ask yourself the following questions before making a commitment to borrowing.

6 Big Questions before Borrowing & getting into Debt.

1. Do I really need it in the first place?

Many a times we tend to buy things we do not need. Getting the latest iPhone? Getting new clothes because of an event? A growing number of people are now buying things that they don’t really need, but due to the people around them or society itself we make the purchase on the item. We love ‘the thing’, hence we need ‘the thing’. Sounds familiar?

Many of our purchases are due to our inability to resist the temptation for instant gratification. We are turning into a first buy, and then pay for it later lifestyle; without knowing whether we can earn that money in future! Be very careful of instalment plans on purchases. It’s easy to underestimate the small weekly payments as it can add up to a whole lot more. Avoid being rash in purchase decisions and check the terms and conditions of any such instalment policy.

Start simple. Assess whether the purchase decision is a need or a want. Determine whether if it’s something that you can wait. Then save up for it and make the purchase later. Buy when you need it, not when you want it.

Impatient: Today's tweens want everything fast, with 56 per cent admitting they prefer instant gratification - Dailymail.co.uk

Impatient: Today’s tweens want everything fast, with 56 per cent admitting they prefer instant gratification – Dailymail.co.uk 

2. Is there another way I can pay for my items?

Sometimes, there are subsidies and grants for items. Some of the easiest way to pay for a new item is to sell an old one. At least this reduces your purchase price of the item or even make a profit out of your sale.

Try making a bargain on your purchase items or check out online marketplaces for cheap deals and second-hand purchases. Many a times, we seldom need items that are brand new. Pre-loved items are currently in trend now as it sharply marked down from its usual price.

Stretch your dollar on your purchases. Singaporeans are embracing the second-hand market and its a fast booming economy.

Stretch Your Dollar - Second-hand Economy

Stretch Your Dollar – Second-hand Economy

3. I already have other monthly expenses. Can I still afford it?

Track your budget. Use a budget tracking app or even an excel spreadsheet to understand your financial standing. See how much you have left after your monthly expenses, borrowings and savings. Look at the amount at the end of the day and determine whether it is still advisable to buy it or to put off the purchase.

Make a budget. Always.

Make a budget. Always.

Here’s a quick video on managing your debt in Singapore.

4. How much should I borrow?

How much should I borrow

How much should I borrow

Always try to make a larger downpayment that you can afford or go with a repayment policy that is bigger and shorter within your means. Go for loan plans that can be paid off earlier than the set period so as to avoid incurring further interest on your debt.

Borrowings should always be kept within the repayment limits; too much or too little can be restricting in their own way.

5. How much do i have to pay every month?

To keep your financial status healthy, you should not fork out more than 35% of your gross income on your total debt that you have.

Balancing Your Debt Payment

Balancing Your Debt Payment – Ensure that you plan your debt repayment well against your income

6. How long will it take to pay off my loan?

Managing Your Loan Repayment Period

Managing Your Loan Repayment Period

The longer a loan period is, the more you end up paying. Ask for a comparison of loan tenures across different loan packages that loan companies offer. Look for the interest rates and cumulative interest rates as this will help you in making an informed choice to decide on a comfortable repayment period for your debt.

Ask the loan officers for a manageable repayment period within your means. Understand the different undertaking of each loan types from them too. Payday loans, personal loans, housing loan or even renovation loans are different terms that a loan officer will use. Choose one that best suits your situation.

Conclusion

The whole point here, is that we don’t think much about long-term aspects of our spending and hence make bad financial decisions that land us into debt. Always spend within your means.

Ask yourself repeatedly; Do i need this? Can I afford this? How can I pay for it?

Know your own financial ability and borrow the minimum you need. All these will allow you to have a peace of mind and be financially sound. And finally, always be prepared for life’s “What if’s”. Have emergency savings to fall back on to cover against life’s ups and downs.

References

 

Moneylenders Genuine or Fake

Moneylenders boosting sales or genuine to help via online platforms?

Singapore — Followers and friendship is cheap. Recent article on the May 11, Sunday Times 2014 showcasing the bloggers community in Singapore. Highlighting that there is an increasing number of people buying “likes” on Facebook, Instagram and other social platforms. People have been boosting their online popularity by paying for “likes”, retweets and followers. All these for a small price. True? Totally.

Now there are modern bots who are very good at emulating human interactions and these are developed by service providers who all want to earn from a person’s or company’s ego. Some companies are known to using these providers to give them an edge in the market.

Stronger” social community means the company has some good PR with the customers right? Well, don’t be too easily deceived by it. Having higher numbers of ‘Likes‘ or ‘Followersdoes not necessary tell you anything about the person or business. Believable? Up to you.

Moneylenders giving a bad name to themselves

It has come to a concern that in our community of licensed moneylenders, there are an increasing number of companies using link networks and providers. Unlicensed moneylenders or some legit lenders even, have used similar offerings to promote their website. All these are done in order to attract and achieve more sales for the company. However, most of the services provided by them are like just to close sales and increase loans take up rate rather then sincerely there to provide good services and advice.

Some of these loan information are grabbed from other websites that are not even relevance to Singapore. Marketing firms have been arguing about this practise stating that these providers are providing dishonest means to convince their customers.

Increasing number of moneylending firms using black hat SEO techniques to boost ranks

Increasing number of moneylending firms using black hat SEO techniques to boost ranks

Paid articles or blogs to popular bloggers made by moneylender firms are increasingly misleading and the competition is heating up. With strict laws made by the government, some moneylenders are now using these methods to give themselves good online reputation.

As consumers, always do your research and check out the reality of the information and accuracy. With the internet providing vast amounts of information, it’s now much easier to make your choice. Look out for legit reviews and always check out the competition.

Online popularity the right way

As a licensed moneylender company, we want to provide real value to our readers and to allow them to make the right choice when they require a loan. This is why we have written lots of guides on the hows of getting the right loan and the whys of borrowing from licensed moneylenders.

Our practise as legit moneylenders, we want to provide sound advice to borrowers. We understand the borrowers mindset, that they want quick solutions to solve their financial woes. This is why we have heavily emphasized on the “what to avoids” inborrowing.

Ask our loan officers and they will offer you great advice

Ask our loan officers and they will offer you great advice

We want to the educate the borrowers first and provide the most updated information to them.

Borrowers need to understand on how to choose the right moneylender and to know about the importance of borrowing from a legitimate licensed money lending firm. Although there has been a surge in money lending firms in the neighbourhoods, the government has been introducing ways to curb bad practises made by some firms. Hence checks are constantly carried out and firms found flaunting the rules are heavily fined.

Therefore, do not be shy to pick up the phone and call the licensed moneylenders and enquire for more details before taking up a loan. Pay a visit to the moneylenders office and find out more information and ensure they are legit and sincere loan providers before signing on any loan document.

Doing all the necessary checks and finding out more information do not only ensure you are borrowing from the right source but also ensure you get the best available loan as well as the right loan package that you are able to service and solve your financial difficulties during tough times.