As in almost every country, people in Singapore often need loans for one reason or another and so for when they do, they have to learn where they can get those loans from. Usually people will associate getting loans with going to a bank but sometimes a bank may not approve your loan request or you know that as the loan process with a bank can take several days and you need the money sooner than that, you need to learn who else can grant you a loan. The other people that can grant you a loan are known as money lenders but there are two main types of money lender and learning the difference between the two is very important. The first type of money lender is the licensed money lenders who, in order to keep their license, must keep their rates of interest within certain parameters and have sat repayment plans. The second type of money lender is the un-licensed money lender and as they have no license to worry about, can charge whatever they like as interest on any loan they grant. In some countries it is difficult to distinguish which is a licensed money lender and which is an un-licensed money lender but in Singapore you can read more about which is which on a website that lists only the licensed money lenders and not the un-licensed ones. The difference between these two types of money lender is important to learn because the interest rates that many of the un-licensed money lenders charge are so high it causes the borrower trouble later. Sometimes the interest rates are so high and the repayment terms are so harsh that a borrower has to once again return to ask for another loan in order to pay off the first one and this process can be repeated over and over again, leaving the borrower in a lifetime of debt just because they had one urgent need for a loan. As the licensed money lenders are regulated, their rates are usually reasonable as are their repayment terms which mean that most borrowers are able to repay the loans with only the minimum of inconvenience, which is how it should be and usually is with a bank loan.
Although both a bank and a licensed money lender will both have criteria which have to be met in order for a loan to be approved, the licensed money lender’s criteria are often easier to meet than the banks. If an unlicensed money lender has any criteria, it is probably only that the borrower must repay the loan in the specified time and in the specified amounts and so they will almost certainly approve any loan request you may submit. The other difference between money lenders and banks is that a money lender, licensed or un-licensed, will probably approve and process your loan request in the same day as the request is made, making the loan amount almost immediately available.