3 examples of unlicensed money lending

Man holding a stack of Singapore dollars as unlicensed money lending is taking place

Unlicensed money lending is not as uncommon in Singapore as you might think. Whether you’re looking for a legal money lender that operates professionally, or just simply looking to avoid landing yourself in a nasty situation when taking up a loan, this guide will help you navigate through the right way to take up financial loans.

Difference between unlicensed and licensed money lending

Don’t let scammers stop you from taking up a loan. Once you get the basics right in terms of the requirements to operate a money lending business, it will be pretty straightforward to differentiate between a lender that conducts unlicensed money lending and a legal money lender

A licensed money lender in Singapore will have a registered physical outlet to run their business. The place of business should be registered under the Ministry of Law. Unlicensed money lenders tend to operate differently, with no apparent physical place of business that’s legal.

What are common examples of unlicensed money lending?

Here are three common types of unlicensed money lending that you should be aware of:

Harassment via cold calls, unsolicited text messages

You can also tell the difference from the forms of advertising their services. A business that’s conducting any form of unlicensed money lending will advertise via flyers, SMS, Whatsapp messages that are not within the specified rules of advertising for legal money lenders such as (a) business or consumer directories (in print or online media); (b) websites belonging to the moneylender; and (c) advertisements placed within or on the exterior of the money lender’s business premises.

Online loan process, no option for you to enquire at a legitimate place of business

Another obvious example is the money lender not having a legitimate and approved place of business where you can go to sign the contract officially. Unlicensed money lenders will try to go for a 100% remote and/or online loan process which is not permitted.

A licensed money lender in Singapore has to verify the identity and particulars of the borrower at the place of business before granting the loan. Check the address of the money lending office at the official registry of money lenders.

Charging processing fees before loan is approved or granted

A licensed money lender in Singapore will not ask you to make any form of payment before the approval of the loan or before the loan is distributed. This includes any exorbitant processing or admin fee that might come up.

Any form of administrative fee should only be paid after the loan is approved and disbursed to you. Payment might also be deducted from the loan principal itself, but never before the loan is provided to you.

A businessman presenting Moneylender text, graphs and diagrams showing the need to be informed about unlicensed moneylending

How to know if you’re working with legitimate money lenders

Money lenders that conduct unlicensed money lending practices tend to avoid answering your queries directly as opposed to a legal money lender. A legal money lender will provide you with proper information regarding the terms and conditions of any loan contract before you commit and sign it.

If you find yourself in a situation where you are being forced to commit to a loan (even to a point where you feel threatened), then you might be dealing with an unlicensed money lender. Always check the registry for their license to operate.

What to do if you’re dealing with unlicensed money lenders

In Singapore, there are options for you to turn to when you’re dealing with unlicensed money lenders such as loan sharks. Here’s a list of hotlines that you can use in case you land yourself in a sticky situation with illegal money lenders.

Credit Counselling Singapore: 6225-5227

ComCare: 1800-222-0000

National Crime Prevention Council’s X-Ah Long hotline: 1800-924-5664

Legitimate loans you can consider

If you’re seeking personal loans but are wary of your options, know that there are plenty of legitimate money lending businesses in Singapore you can consider – you just need to make sure they’re registered and you’re good to go.

For instance, Dio Credit offers a variety of personal loan options and even debt consolidation plans that allow you to consolidate all your debt into a single plan for easier loan management.

You may find yourself in an unfortunate situation where you are already dealing with loan sharks and unlicensed money lending.

Read more here to find out the steps to take when dealing with unlicensed money lending and loan sharks.


While all reasonable efforts are made to include accurate and up-to-date information on this website, errors or omissions may still occur. We are not liable for any loss or damage caused by the use of this website. The information on this website is for general information only and should not be taken as professional advice.

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