Whether you need money for your business, or are facing a personal need, a moneylender can help you out in times of a financial emergency. If you are considering borrowing from a moneylender, it is always advisable to search for a licensed moneylender. Not only are unlicensed moneylenders illegal in Singapore, they often perform dishonest dealings and land borrowers in huge debts. In contrast, licensed moneylenders provide not only financial aid, but also repayment advice. The best licensed moneylenders are genuinely concerned with empowering people using temporary loans, and not with earning unreasonably from clients.
With a large number of licensed moneylenders in Singapore, it is sometimes challenging to determine which is right for you or your business. The best way to get around this is by doing ample research on moneylenders that are licensed and reliable. Look out for these traits that are characteristic of a reputable moneylender:
Prime location: Reliable moneylenders typically operate from offices and stores that are located in commercial buildings like shopping malls or neighbourhood centres. They display their name and services clearly and are brightly lit. Most licensed moneylenders nowadays also have an online presence with an official website that presents their services. In contrast, beware of moneylenders that operate out of homes or dingy locations with no prominent name displayed. Chances are, these are people engaging in illegal moneylending.
Consultation services: Licensed moneylenders are known for providing relevant free consultation services to potential clients. These moneylenders express a genuine concern to help clients with their financial needs, rather than rush or pressure clients to take a high-interest loan. If you meet an excellent moneylender, they will advise you personally on the loans that best suit your needs and consider your financial ability to repay the loan.
Following the regulations: An honest moneylender would deliver services according to the regulations stipulated in Singapore’s Moneylenders Act. They should be up-to-date with their license and transparent with their transactions, stating their contractual terms upfront in clear terms. If any moneylender does not have a license number or have clearly stated terms, borrowers should beware of them, as they are very likely to be unlicensed.
Transparent pricing: Legitimate moneylenders are always clear and upfront about their pricing policy. They typically have a fixed processing fee, and a fixed structure for interest fees and loans. These rates also tend to be reasonably pitched such that it is possible for borrowers to repay the loan. As you are looking for moneylenders, stay clear of those with unclear terms or terms that are not written in a contract.
No hidden terms: As mentioned, licensed moneylenders have a transparent pricing system, and as such, there should be no surprise costs. All the terms and conditions should be stated upfront before you sign the contract. That’s why it is crucial to read the contract closely even if you have agreed on the terms verbally with your moneylender – if you realise that the terms and conditions in the contract are different from what was agreed upon, avoid signing the contract and source for a reliable moneylender.