LICENSING REQUIREMENTS FOR DEBT COLLECTION BUSINESS
1. The Debt Collection Act 2022 (DCA) took effect on 1 December 2023. The new licensing requirements for a debt collection business are as follows:
a. Licences for Debt Collection Companies. Debt collection companies will require a licence from the Police, unless they are excluded1 or class licensed2 under the said Act. It will be an offence to do so without a valid licence. Persons who apply for a debt collection business licence must be assessed by the Police to be fit and proper for licence grant. Persons with valid licences may also have their licences suspended or terminated if they breach any regulation under the DCA.
b. Approvals for Debt Collectors. Persons who work as debt collectors for a licensed debt collection company must obtain Police’s approval. Such persons must submit a joint application with his/her debt collection employer-company to the Police. Persons who apply for approvals as debt collectors must be assessed by the Police to be fit and proper for approval. Similarly, a person’s approval may be rescinded if is found to have breached any regulation under the DCA. The debt collection employer-company will also be held accountable for the conduct of its debt collectors.
You may read the DCA at https://sso.agc.gov.sg/.
2. The Police will conduct regular compliance checks on debt collection businesses and debt collectors. Debt collection businesses are reminded to apply for a licence and approvals for their debt collectors prior to commencing their debt collection activities.
3. To apply for a debt collection business licence, please visit https://www.gobusiness.gov.sg/.
4. If you have enquiries, please contact the Police Regulatory Department at Tel: 6835 0000 between 8.30 am and 6.00 pm (on Mondays-Fridays, excluding public holidays) or by filling out this form https://go.gov.sg/spf-prd
Footnote:
¹Exclusion from DC Act. Entities whose debt collecting activities are deemed to pose a low risk of public disorder are excluded from the DC Act. The excluded persons are prescribed under Part 1 of the First Schedule to the DCA and includes the Official Assignee, the Official Receiver, licensed insolvency practitioners, regulated legal practitioners and regulated non-practitioners, joint law ventures, licensed foreign law practices, qualifying foreign law practices, Singapore law practices, accounting corporations, accounting firms, accounting limited liability partnerships, chartered accountants, and public accountants.
²Class Licensing Regime for Regulated Businesses. A class licensing regime will be introduced for entities that are regulated by other government agencies and that are engaged in lending and collecting money owed to their respective businesses. The regulated businesses are prescribed under Part 2 of the First Schedule to the DCA and includes banks, merchant banks, licensed credit card or charge card issuers, finance companies, and licensed and exempt moneylenders. While these entities do not need to be individually licensed, they are class licensed under the Debt Collection (Class Licence) Order 2023 and must comply with the conditions of the class licence, e.g. only deploy their employees to collect debts owed to their company.
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