More often than not, people who fall prey to loan sharks are individuals in desperate need of a fast cash loan, payday loan, or those who are unaware that they’ve engaged a loan shark instead of a legal money lender or licensed moneylender.
You may be wondering, “What is a loan shark and how do I deal with loan sharks in Singapore?”
In essence, a loan shark is a person or organisation that illegally loans out money with extremely high-interest rates and cutthroat fees and charges. As they tend to be a part of organised crime groups in Singapore, they often threaten their victims and even resort to using violence to collect their debts.
If you’ve started dealing with a loan shark, it’s not too late to get out. We’ll show you how to deal with loan sharks in Singapore in this guide.
What are the common behaviours of loan sharks?
Unlike licensed moneylenders, once you manage to get a fast cash loan or any type of loan from loan sharks, they can become extremely unpredictable and violent. They can harass you and your family with a variety of threats and physical abuse.
Other than violence, loan sharks do have other ways to make your life miserable. Even if you are able to punctually repay your scheduled repayments in full, they can still come up with new terms to extort more money from you. These methods include imposing additional fees or suddenly changing your loan tenure to a shorter one, making it impossible for you to fully repay the loan on time.
How do I know whether I’m dealing with a loan shark?
The first thing you should do when enquiring with any money lender is to ask for their credentials or their licence certifying that they are permitted to operate as a licensed moneylender under the Ministry of Law in Singapore.
You should always do your research and observe how moneylenders advertise their services. A legitimate and licensed moneylender will never advertise their services via instant messaging services, emails, and SMSes with dodgy information as these forms of advertising are illegal.
According to the Ministry of Law, a legal money lender in Singapore can only advertise its services on business and/or consumer directories, its official website, and advertisements placed in its place of business.
You can see many lenders advertising fast cash loans and payday loans in shops that may appear questionable on the outside but please do not be mistaken. These licensed moneylenders operate legally and are permitted to provide payday loans and a variety of other loan types according to the law.
What should you expect when you borrow from loan sharks?
Here’s a potential list of things that can happen if you seek out a loan shark’s services:
- They reach out only via SMS, email, or instant messaging services and agree to the loan via a text message or phone call with no in-person review
- You do not receive a proper draft or copy of the loan contract
- You receive an incomplete loan contract, if you do get one at all
- The loan’s terms and conditions are questionable, with grammar errors
- The conditions aren’t completely listed, yet the ‘staff’ are asking you to sign it
- They do not make any clarifications when you ask them to elaborate on the loan’s terms and conditions
- They do not return the original copies of your personal documents
How do I ensure I’m engaging with a licensed moneylender?
Apart from checking against the full list of licensed moneylenders here, a legal lender will provide you with a proper contract that fully states the loan’s terms and conditions. These details include the loan’s interest rate, tenure, repayment schedule, and any other additional fees and charges.
Additionally, most licensed moneylenders are professional and will answer every question that you have before you sign off on the loan contract. At no point will they coerce you if you feel uncomfortable with the loan presented to you.
What can you do if you’re mistakenly dealing with a loan shark?
Here’s how to deal with loan sharks in Singapore, especially if you are already in business with them and need assistance urgently:
- Credit Counselling Singapore: 6225-5227
- ComCare: 1800-222-0000
- National Crime Prevention Council’s X-Ah Long hotline: 1800-924-5664
These are emergency contacts that you should reach out to if you’re already involved with loan sharks or if you’re stuck at getting out of the harassment that these illegal money lenders are putting you through.
Where can I find legitimate financial help?
If you’re in need of cash but are drowning in debt, there are better solutions than seeking financial assistance from a loan shark.
Licensed moneylenders such as Dio Credit offer debt consolidation plans that allow you to bundle your debt into a single plan for easier loan management. Enquire with Dio Credit today and our experienced loan executives will get back to you as soon as possible!