Finding out if a moneylender is licensed
The Ministry of Law has made it easier for borrowers to verify how legitimate a moneylender is and whether or not they are licensed. The ministry has created a list of all licensed moneylenders in Singapore. As a borrower, you can easily check the list and verify if your preferred lender is licensed.
The law prohibits lenders from soliciting loans through phone calls and text messages. If you’re encouraged to acquire loans through these methods, there is a good chance the lender is not licensed. All authorized lenders can advertise their services using the following channels.
- Consumer and business directories in both online and print media.
- Online platforms belonging to the licensee.
- Promotional content placed on the exterior or within the approved business premises.
Prohibited practices for authorized moneylenders
While a lender may be licensed, they are prohibited from some unfair and unlawful acts. These include;
- The use of unprofessional language – threating or abusive.
- Asking prospects and customers to disclose their password or SingPass ID.
- Failure to hand back the customer’s NRIC card or any other personal ID paperwork such as passport or ATM cards.
- Asking customers to sign incomplete, incorrect, or blank Note of Contract for the loan.
Moneylenders shouldn’t give customers loans with no proper explanations of the terms and expectations or without due diligence. For instance, the lender shouldn’t approve your loan through text messages before acquiring and analyzing your loan application and all other supporting documents. These lending institutions should not withhold any part of the loan for any reason. If any of the issues mentioned here occur, the moneylender has violated relevant regulations. Consider reporting the matter to the Registry of Moneylenders.
Based on the Ministry Of Law, licensed moneylenders also have a maximum amount of interest rate they can charge in Singapore.