Unscrupulous lenders, often called illegal money lenders, have seen an increase in Singapore, and these entities prey on vulnerable individuals facing financial difficulties, trapping them in a cycle of debt with exorbitant interest rates and coercive tactics. These illegal money lenders also entice the public to borrow from them, promising them unrealistic benefits via messages, phone calls, or social media channels.
Due to the harsh treatment of these illegal money lenders, they have been blacklisted by the Singaporean government through the Ministry of Law (Minlaw) to protect the citizens and the nation’s financial sector. Here in this article, we will look at the blacklisted moneylenders in Singapore, how to detect them and what to do after detecting them.
Who are Blacklisted Moneylenders in Singapore?
Blacklisted moneylenders in Singapore are moneylenders who have violated the rules specified in the Moneylenders Act. These individuals have had their licenses suspended or revoked due to the gravity of their offences.
A licensed moneylender consistently engaging in unfair or unscrupulous practices against borrowers may acquire a bad reputation, leading to community blacklisting. It is crucial to note that even if these moneylenders still hold valid licenses (possibly due to ongoing investigations), it is advisable to avoid them to prevent unpleasant encounters.
The last of blacklisted moneylenders in Singapore is regularly updated by the Ministry of Law (Minlaw), and it is stated at the bottom of this page.
How to Identify Blacklisted Moneylenders in Singapore
Before borrowing money from a moneylender, it is essential you identify whether they are legal and reliable and illegal or blacklisted. This will help protect you from several troubles. As such, we will be looking at some ways you can b identify blacklisted moneylenders and illegal moneylenders in Singapore.
1. License Status Verification
One of the primary ways to identify blacklisted moneylenders in Singapore is to check the Ministry of Law (Minlaw) Registry on their official website. If the moneylender is not licensed, it is illegal, and you should stay off it. In blacklisted money lender, their license is usually evoked.
Regular updates from the Registry of Moneylenders help you steer clear of blacklisted lenders in Singapore, offering a safeguard when securing a loan. Beyond checking tier license status, carefully read the user reviews for a comprehensive understanding.
2. Advertisement Channels
Licensed moneylenders abstain from soliciting loans through unsolicited text messages or calls. Also, they avoid potential ‘Ah Long’ encounters or licensed lenders breaching regulations, but unlicensed ones use advertising routes that MinLaw prohibits.
MinLaw permits advertising through official websites, consumer/business directories, and within the moneylenders’ premises. If you notice the moneylender is constantly on your neck, enticing you to come to borrow a lona via call or text messages, you should know that you are dealing with an unlicensed money lender.
3. Fees and Interest Rates
Licensed moneylenders adhere to regulated fees and interest rates stated by the Registry of Moneylenders. Stay vigilant for red flags such as exorbitant interest rates, late fees exceeding S$60, administrative fees surpassing 10% of the personal loan, interest rates higher than 4% on the loan amount, late interest rates that are above 4% on each late instalment and lack of precise interest rates and fees.
4. Physical Address Verification
The updated list from the Registry of Moneylenders includes the physical address of licensed lenders. So, you must verify the company’s physical address before borrowing from them.
Beware of dealing with lenders remotely, as it may indicate dealings with loan sharks. Also, loan agents that ask you to meet them in undisclosed locations should be avoided because they are illegal and, possibly, blacklisted.
5. Face-to-Face Verification
Despite online loan facilitation, face-to-face verification remains a pivotal requirement. Technology may streamline processes, but physically visiting the office is indispensable. Be wary of lenders relying solely on electronic communication for loan approval, as face-to-face verification is critical. This is because blacklisted moneylenders in Singapore can only operate via the online sphere, and you must be careful so that you dont fall into their trap.
6. Document Return and Contract Clarity
Licensed moneylenders adhere to ethical practices by returning essential documents, including the NRIC, after scrutiny. A comprehensive loan contract explains critical points like repayment terms, interest rates, and the repayment period. This transparent approach distinguishes licensed lenders from their unauthorized counterparts.
If the moneylender does not have a comprehensive contract list that shows their mode of operation, including fees and interest plan, please stay off, as they may be blacklisted moneylender. Also, avoid that they are not transparent and refuse to disclose important information.
What to Report Blacklisted Moneylenders in Singapore
Encountering a blacklisted moneylender in Singapore raises immediate concerns, but taking swift and decisive action is paramount. First and foremost, cross-reference the moneylender against the official registry of licensed moneylenders maintained by the Registry of Moneylenders under the Ministry of Law. If the company’s name doesn’t appear on the list, it lacks legal standing as a moneylender.
Next, reach out to the police at tel: 1800-924-5664 to formally report the illicit activities of the money lender. Also, you can contact the Registry of Moneylenders at 1800-2255-529 to report the illegal money lender. In cases where personal safety is at risk or harassment is prevalent, do not hesitate to dial 999 for immediate assistance.
How to Avoid Blaclisted Moneylenders in Singapore
To avoid falling into the hands of blacklisted moneylenders in Singapore, here are some things you should do. They are as follows:
1. Research Thoroughly
Before engaging with any lender, conduct extensive research. Scrutinize their reputation, reviews, and legitimacy. Verify their credentials through official regulatory bodies or government registries.
2. Check Licensing and Accreditation
Legitimate lenders are licensed and accredited by relevant authorities. Ensure the lender’s credentials align with regulatory standards. Consult official databases to confirm their legitimacy.
3. Beware of Unsolicited Offers
Be cautious if you receive unsolicited loan offers through emails, text messages, or calls. Reputable lenders do not initiate contact without a prior inquiry.
4. Review Loan Terms
Scrutinize the loan terms and conditions meticulously. Be wary of ambiguous or overly complex terms. Legitimate lenders are transparent about interest rates, fees, and repayment terms.
5. Examine Website Connection
Verify the security of the lender’s website before sharing any personal information. Look for “https://” in the URL and a padlock icon, indicating a secure connection.
6. Avoid Upfront Fees
Legitimate lenders do not demand upfront fees before approving a loan. Be cautious if a lender insists on payment before providing any services.
7. Verify Contact Information
Confirm the legitimacy of the lender’s contact information. Scammers often use generic email addresses or non-professional phone numbers. Cross-check provided details with official records.
How to Check the Top Blacklisted Moneylenders in Singapore
To check for the list of blacklisted moneylenders in Singapore, simply visit the official list of licensed moneylenders, written and maintained by the Registry of Moneylenders under the Ministry of Law through the
Can I Borrow from Multiple MoneyLenders in Singapore?
Yes, you can borrow from multiple moneylenders in Singapore. However, the disadvantage is that borrowing from multiple lenders increases the complexity of managing your finances. You should note that failing to repay loans as of when due can lead to severe consequences, including additional fees and damage to your credit score.
What Happens When You’re Unable to Repay the Loan from a Moneylender
Failing to repay a loan borrowed from a moneylender in Singapore can lead to serious consequences, particularly when dealing with licensed moneylenders or, in more severe cases, illegal moneylenders.
Licensed moneylenders, who operate within the legal framework set by the government, can pursue legal avenues to recover the outstanding debt. This may involve taking you to court, where a judgment may be made against you. The court could order the borrower to repay the debt and may also include legal costs and interest. This can negatively affect your credit score, making it challenging to secure loans or financial products in the future.
In extreme cases, if the loan was a secure done where you gave collateral for the loan, the moneylender may have the right to seize the pledged assets to recover the outstanding amount.
In the case of illegal moneylenders, failure to repay can lead to harassment and intimidation. They may resort to threatening phone calls, visits to your home or workplace, or even acts of vandalism to coerce repayment. It’s important to note that such tactics are illegal, and you should report them to the police.
What is the Illegal Interest Rate in Singapore?
The maximum interest rate that licensed moneylenders in Singapore can charge is capped at 4% per month. This cap protects borrowers from exorbitant interest rates that could lead to financial exploitation.
If you encounter moneylenders charging interest rates beyond the legal limit or engaging in other unethical practices, you should report such cases to the Registry of Moneylenders or the police.
To know the top blacklisted moneylenders in Singapore, visit the official list of licensed moneylenders. However, you must carefully implement these tactics discussed above to avoid falling into the hands of illegal money lenders.