Don’t fall victim to unlicensed moneylending
The legal way to borrow money is through licensed moneylenders such as banks and other licensed financial institutions. While these lenders may call inviting you to apply for their loans if you are an existing customer, be aware that calls and messages may also come from unlicensed moneylenders.
Before you enter into any loan agreement, be sure to check that the company you are dealing with is a licensed moneylender. You can find the approved list of moneylenders here.
Why avoid unlicensed moneylenders?
You may know unlicensed moneylenders under other names such as ‘loanshark’ or ‘Ah Long’. These outfits prey on people who are vulnerable financially. These victims may not qualify for legal loans but need money desperately, often to simply keep up with living expenses or to pay off existing credit card or gambling debts.
- Unlike the banks, unlicensed moneylenders don’t assess your ability to repay the loan and typically offer higher interest rates that make it impossible for you to keep up with payments.
- When a borrower defaults on payment, these unlicensed moneylenders use harassment methods and threats of violence to scare the borrower into repaying the loan.
- Unlicensed moneylenders may also add penalties when you default on payment, increasing your debt further.
How to spot an unlicensed moneylender
- You don’t have an existing relationship with them and they call or message offering you a loan.
- They send unsolicited messages to your phone.
- They don’t verify your identity or visit your place of business.
- They approve the loan remotely without meeting you.
- They are not listed on the list of licensed moneylenders here.
- They ask you to make payment before, or to secure, the disbursement of the loan, including GST, “admin fee”, “processing fee”, or any other fees. A licensed moneylender will normally deduct such fees from the loan principal.
How to protect you and your household members
- Report all loansharking activities and suspicious individuals in your neighbourhood to the police.
- Join the Citizens on Patrol – these are neighbourhood community groups that help patrol and watch out for each other.
- Educate your family members and your foreign domestic worker on loansharks and the consequences of being involved with them, including having a work pass revoked.
- Ignore advertisements that could be a loan scam. If it sounds too good to be true, it usually is.
- Do not reply to scam or unsolicited messages. Block the number and report it as spam.
- Keep your personal and financial information safe. Do not give out your NRIC, SingPass or bank account details to anyone.
- Educate yourself on loan scams here.
How to get financial help
If you are in financial difficulty, seek help as soon as possible before the problem escalates.
- Credit Counselling Singapore: 6225-5227 (www.ccs.org.sg)
- National Council on Problem Gambling: 1800-6-668-668 (www.ncpg.org.sg)
- ComCare: 1800-222-0000 (www.msf.gov.sg/comcare)
How to report suspected loansharking or scams
Report a scam
- Call the Police hotline at 1800-255-0000, or submit your report online here.
Verify unsolicited invitations to take a loan
- Call the anti-scam helpline at 1800-722-6688
Report a loan shark suspect
Call either of the following and give a detailed description:
- Police: 999
- National Crime Prevention Council’s X-Ah Long hotline: 1800-924-5664