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Need a loan from licensed money lenders in Singapore? Here’s your borrowing guide

on Mar 18, 2022

What are licensed money lenders in Singapore?

A licensed money lender is a registered loan company that conducts legal money lending businesses with borrowers. In order to operate, a licensed money lender is authorised, licensed and regulated by the Ministry of Law. Governed by the Moneylenders Act, there are strict rules and regulations that licensed money lenders have to abide by. 

If you’re looking to get a quick cash loan to tide over urgent money woes, a licensed money lender can help. In fact, licensed money lenders are very inclusive — they aim to help anyone who needs to get a loan fast with minimal hassle, even if you have bad credit history and are rejected for bank loans. 

What can legal money lenders do?

1. Advertise, but not wherever they want

Licensed money lenders are only allowed to advertise via their own websites, at their business premises (interior and exterior), or in business or consumer directories (in print or online media).

2. Charge an interest rate of up to 4% per month

The maximum licensed money lender Singapore interest rate is capped at 4% per month. This holds true regardless of the borrower’s income and whether the loan is an unsecured or secured loan.

Similarly, the maximum late interest rate permitted is capped at 4% per month if the borrower fails to make loan repayments on time. Late interest can only be charged on the amount repaid late. The money lender cannot levy late interest on outstanding amounts not yet due to be repaid. 

3. Charge late fees and administrative fees (capped)

Did you know that a licensed money lender late payment comes with a fee? All licensed money lenders are allowed to impose:

That being said, the total charges imposed by a licensed money lender — such as interest, late interest, upfront administrative and late fees — cannot exceed an amount equivalent to the principal of the loan. 

4. Offer loans to borrowers with steady stream of income

The maximum loan amount you can get for an unsecured loan is dependent on your annual income:

Secured loans typically come with a cap on how much you’re allowed to borrow, depending on the value of your collateral, e.g. your home or car. 

According to latest property cooling measures, if you are getting a home loan where the Option to Purchase is granted on or after 16 December 2021, your Total Debt Servicing Ratio (TDSR) has to be ≤ 55% for the purchase of properties. This metric takes into account all your existing debt obligations, such as car loan and other secured and unsecured loans. 

MinLaw regularly updates licensed money lenders’ new rules on their page on borrowing from licensed money lenders, so check it out for more details.

5. Offer borrowers flexible repayment schedules

Most licensed money lenders offer flexible repayment schedules, so consider your income, budget and financial obligations very carefully before signing your loan contract with the stipulated loan terms. Always negotiate your repayment schedules to your advantage! 

Here are 5 myths about borrowing from licensed money lenders – it’s always useful to have the right understanding of what they do before you take a loan.

Need a loan from a reliable licensed money lender? R2D Credit is your best option.

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What are licensed money lenders not allowed to do?

1. Solicit loans through messages

Licensed money lenders cannot solicit loans through social media platforms, text messages, WhatsApp, emails, flyers, and direct phone calls, etc. 

Been receiving annoying spam messages asking you to take up loans? Those are likely sent by unlicensed money lenders and/or scammers. Do not entertain them.

2. Perform loan transactions entirely online

It is a must for licensed money lenders to meet the borrower in person at their office premise to conduct physical face-to-face verification of the borrower’s identity before granting any loan. 

In short, licensed money lenders in Singapore are not permitted to perform loan transactions fully online. Loans cannot be disbursed remotely without any face-to-face verification.

3. Skip contract explanation and financial assessment

Financial assessments such as the checking of a borrower’s tax notices and payslips must be executed before a loan can be approved.

Likewise, the law requires licensed money lenders to explain all loan terms clearly to you in a language that you fully comprehend. Feel free to clarify or ask your loan officer to repeat — a good licensed money lender will not hesitate to go the extra mile so that you know all that the loan contract entails.

You should also receive a copy of the loan contract. Apart from understanding all the contractual terms, pay extra attention to the repayment schedule, interest rates and slew of fees applicable.

4. Keep your NRIC or any other personal ID documents

Make sure your licensed money lender doesn’t withhold your NRIC, driver’s licence, passport or other personal ID documents. They are also not allowed to acquire any information that contains passwords to your Singpass account, Internet banking account, email account, etc.

5. Not issue you a receipt each time you make your loan repayment

Ensure the money lender issues you a receipt each time you make your loan repayment, and check that all details are correct (e.g. name, amount paid, outstanding amount, date). 

Definitely make it a habit to retain all statements of accounts and receipts of payments, as documentation of payments.

Money lender Singapore: Banks vs licensed money lender

While you can borrow from a bank or licensed money lender in Singapore, there are differences you need to know about

Here’s a quick comparison between borrowing from a bank and legal money lender, assuming you are getting a personal loan:

 Max. sum you can borrowMax. repayment periodLoan approval durationTypical interest rateEase of loan approvalProcessing feeApplication procedure
BanksUp to 10x monthly incomeUp to 7 yearsUp to 2 weeks3.5 – 11% per annumStringentTypically 1% of the approved loan amount, some offer no processing feeApply online or visit branch office
Licensed money lenderUp to 6x monthly incomeUp to 12 monthsSame day, typically within 30 minutes1 – 4% per monthLenientUp to 10% of the approved loan amountMust visit office


Can’t qualify for a bank loan? We offer fast loan approval with less stringent criteria.

Apply for a loan with R2D Credit now

Legal money lender Singapore: Advantages and disadvantages

Borrowing from licensed money lenders often comes with its own set of advantages and disadvantages, such as higher private money lenders interest rates. 



How can you verify if a money lender is licensed

Did you know it is possible to check a money lender’s license online in just a few clicks? All you have to do is access MinLaw’s list of licensed money lenders in Singapore. The cool thing to note is that the list is periodically updated to show which money lenders are in operation as well as the ones that have been suspended. 

As of time of writing, there are 156 licensed money lenders in Singapore. It is not guaranteed that anyone and everyone can get a money lender license. The Registry of Moneylenders has the authority to suspend the grant of new money lender licenses as they deem fit. 

To be on the safe side, dial the licensed money lender’s registered landline to double-verify. You would also want to check if the licensed money lender really does have a physical office.

24 hours money lender Singapore: Do they exist?

There aren’t any 24 hours money lenders in Singapore if you’re talking about licensed, legal ones. Those that run 24/7 are likely to be unlicensed or illegal. 

Although licensed money lenders have websites that run 24/7 (i.e. you can submit your loan application on the licensed money lender’s website anytime and anywhere), their physical offices have fixed office hours and do not operate round the clock. 

How to determine best licensed money lender

Characteristics that define the best money lender in Singapore include: 

For example, if I am dealing with rapidly growing debt from multiple loans, I would look for licensed, quick money lenders and reliable money lenders that offer competitive interest rates. 

If I have multiple loans, I would pay attention to money lenders near me who also happen to be debt consolidation plan money lenders with good reviews, to consolidate my loans. 

Finding a reliable lender?

R2D Credit is an established Yishun licensed money lender since 2009 and we have served more than 2,600 borrowers, with 1,300+ 5-star reviews on Google.

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How to borrow from licensed money lenders in Singapore?

  1. Open your licensed money lender’s loan webpage.
  2. Check that your licensed money lender is indeed legitimate – call them and check that their details are the same as those stated on MinLaw’s list
  3. Fill out the online loan application form with your personal details (e.g. name, contact number, salary and the desired loan amount)
  4. Wait for a loan officer to contact you
  5. Set up an appointment to meet your loan officer at your licensed money lender’s registered business address
  6. Meet your loan officer; bring all necessary documents with you when you visit
  7. Ensure you are clear about all the loan contract’s terms and conditions, late charges, interest payments, repayment schedules etc before signing on the contract. Feel free to get your loan officer to clarify anything you may be unsure of
  8. Thereafter, your cash loan will be disbursed immediately via cash or bank transfer.

Documents required

What happens if you’re unable to pay money lender Singapore?

If you don’t repay your loan on time, expect to incur late fees, late interest and compound interest on the amount that’s repaid late. If your loan is a secured one, your pledged collateral may be at risk of being liquidated. 

Should you find yourself in such a situation, try to request for a realistic payment extension — work things out amicably with your licensed money lender to negotiate reasonably. 

What can you do if you encounter licensed money lender harassment?

Common acts of harassment include:

You may report to the Registry of Moneylenders at 1800-2255-529 or via their website should you wish to lodge a complaint against a money lender. Rest assured your personal details will be kept confidential. Additionally, the Registry will investigate errant licensed money lenders.

At R2D Credit, we ensure that all our staff adheres to the highest standard of professionalism and ethics.

Finding a trustworthy licensed money lender in Singapore?

Apply for a loan with us today