As of 1st Oct 2015, www.mlaw.gov.sg has changed the licensed moneylenders’ interest rate in Singapore from 20% monthly to 4% monthly. At the i-Credit home website and our storefront, we have changed or updated the information accordingly on the eve of 1st Oct 2015 as well.
Difference Between Old & New Licensed Moneylender Interest Rate Update?
In the New Interest Rate:
All borrowers will subjected to a 4% monthly interest rate for all income groups. The amount of loan will be based on the yearly income of the borrower plus administrative fee. Below is the summary in the table;
|Income Group||Licensed MoneyLender Interest Rate (Monthly)||Loan Amount|
|Less than $20,000 Yearly||4%||Up To $3,000|
|From $20,000 or more.||4%||Up to 6 Month's Income|
From now on, all income groups will be able to get a loan from i-Credit. Here’s what we need and you to take note of when you visit us;
Primary concerns that need your attention
- Do not forget to consider various alternatives before approaching a moneylender including numerous financial assistance plans offered by different governmental agencies.
- Do remember your Singpass login details as well, since the licensed money lenders need to find out your annual salary through the IRAS website.
- Remember that the loan contract needs to be legally fulfilled as per the contractual terms. Hence, it should be calculated keeping your income and other financial obligations in mind.
- Carefully read and fully understand the terms and conditions of the loan contract before you agree to any of it. You must legally possess your own copy of the contract.
- Choose only the most favorable cash loan option by researching different moneylenders, instead of rushing into a commitment.
In the previous interest rate, taken from our previous blog post:
Here’s what you need to know regarding Licensed Moneylender’s interest rate according to the Registry of Moneylenders:
13 percent Effective Interest Rate for secured loans, &
0 percent Effective Interest Rate for unsecured loans ( personal type).
The old interest rate is capped if the annual income is less than $30,000. An ethical licensed money lender is to disclose to borrowers in writings what are the Effective Interest Rate of the loan amount. Do note that different license money lender companies may have slightly different interest rates for their clients and lend them the money.
The Effective Interest Rate takes into account the compounding effect of the frequency of installments over a one-year period.
This means that the Effective Interest Rate better reflects the actual cost of borrowing over a one-year period. Visit https://www.mlaw.gov.sg/content/rom/en.html to find out more about how the Effective Interest Rate is calculated from 1 June 2012.
If your annual income is $30,000 or more, the caps above are not applicable and interest rate is to be agreed upon between the moneylender and the borrower.
In I-Credit, We give discounted interest to return customers with good records and credit ratings. we typically offer 3 different sets of interest rates for different clients.
11% Interest Rate per month : usually rendered to borrowers with good credit history and/or on time installment repayment.
14% Interest Rate per month: for returning customers that have previous business relationships or records with us.
18% Interest Rate per month: for new customers that have no previous business relationship or record with us.
Do note that the 3 different sets of interest rates are no longer in use in i-Credit business from 1st Oct 2015 onwards.