Banks vs. Licensed Money Lenders in Singapore
It seems to me that a bank is willing to lend you money only when you don’t need it. Well, many Singaporeans have the same feeling about borrowing money from banks, therefore they are now turning to licensed moneylenders. Is it true that they are more relaxed than banks? On the other hand, couldn’t they be just loan sharks? I’ve tried to get the answers to these and similar questions and here’s what I’ve found out!
Moneylenders in Singapore, such as Geecredit pte Ltd Cash Lender, are licensed by the Registrar of Moneylenders. This license means restrictions on the amount they are able to lend, as well as the interest rate and fees they can charge. In general, moneylenders are businessman and it’s in their best interest to build a good reputation. In case they need to chase down a debtor, they only send reminder letters, just like banks would. But, it’s where the similarities with banks end. Some of the key differences are higher interest, speed, focus on small loans and forgiving credit assessment.
Almost every moneylender in Singapore is empathic on smaller loans only. They’ll usually offer you 2-4 times your monthly income or even less. Customers in need of payday loans are the ones they are interested in and they simply don’t want to bear the risk of your $20,000 renovation. In other words, lending institutions here are ideal for urgent, small fees, for paying a clinic, a plane ticket etc. If you need money for renovation or a business start-up, most money lenders in Singapore are simply not interested in those loans.
Provided you can produce all the necessary documents, most moneylenders offer to approve the loan within an hour (or even less). This is because the amounts are not so big and there are not so many bureaucratic layers compared to a bank. So, if you need the money right now, for example for medical reasons, banks are rather slow, while moneylenders will be able to help you.
Talking about fast cash, a moneylender is your only alternative in case you don’t have a credit card. On the other hand, a credit card is arguably cheaper than licensed money lenders. However, we all know that banks are quite obsessive about credit rating. If your rating is too low, they will most certainly deny your loan application, while a moneylender will be less fussy about borrower’s credit score. But, even though licensed moneylenders, such as www.rcssvc.com.sg , are more forgiving, they will most certainly do background checks, just in case. If you have significant credit card debt and/or outstanding loans from other lender, your loan might also be denied.
