Why Licensed Money Lenders Can Be A Healthier Alternative to Banks
What do you do when you are cash-strapped and desperately need to pump out some quick credit but can’t do so because of your bank’s meticulous bureaucracy? Don’t panic! There’s no need to start mortgaging assets and selling things to your local pawn shop. When you have licensed money lenders on hand, you never need to worry about making a financial mockery out of yourself in the midst of a minor cash crisis.
In fact, the lower the personal loan amount you require, the stronger your chances of getting it from a licensed money lender. Today we will take an in-depth look at how these professional loan sharks have helped give Singaporeans a convenient alternative for taking small short-term loans.
Licensed money lenders in Singapore aren’t just some run-of-the-mill creditors who print out their credentials from some shady online website. They receive their license from the Singaporean Registrar of Money Lenders.
They must mandatorily adhere to all guidelines on lending amounts, service fees and interest rates in order to do business. Unfortunately, the infamous perception of independent lenders is often associated with shady loan sharks and mobsters who don’t hesitate resorting to vandalism or other forms of harassment to get their money back.
Luckily, licensed money lenders are reforming their image as thorough businessmen who abide by all Singaporean laws and only hire accredited debt collection agencies to recover their money. But the real USP of licensed money lenders lies in their ability to provide financial assistance on a level that banks simply do not offer the flexibility to attain.
Let us highlight some of the key benefits offered by licensed money lenders that supersede the services of banks:
Favorable for Mini Loans
I contacted six different money lenders, all of whom were emphatic on small loans only.
Money lenders are a boon for Singaporeans looking for small loans that can be utilized for minor things like paying off medical bills, repairing your car, etc. Licensed money lenders stick to these risk-averse loans to mitigate the negative backlash from unpaid debt.
Legally, the lending limit guidelines provided to these independent lenders is no more than 2-4 times the monthly salary of the borrower.
Since licensed money lenders primarily dole out small payday loans, the turnaround time and process of loan approval is tremendously fast-tracked. Additionally, there are barely any bureaucratic layers of management who extensively deliberate over your request.
Any Singaporean borrower who has his financial documents in order can get his personal loan approved in the span of 30 minutes. Amazingly, that’s almost the same time it takes to order a Dominos Pizza!
Steep Interest Rates
Although a majority of money lenders insist on negotiating rates only after personally meeting you, it does not mean they are trying to cut underhanded illegal deals. It’s simply a smart business strategy on their part to lock in Singaporeans desperately looking for a small loan without wasting much time.
Since most borrowers are short on time and patience, they do not give much resistance in complying with the steep 25%-30% interest rates offered by licensed money lenders.
Hence, it’s recommended to pay a visit to a few finance blogs to shop for the best possible rates.
High Tolerance for Bad Credit Score
Everyone knows that credit scores are heavily scrutinized by banks during a loan application process. They will not hesitate to bluntly show you the way out in case your rating is severely damaged.
Money lenders on the other hand, are far less pesky and nitpicky regarding your credit score because the amount they lend is rather low compared to bank loans. Even former bankrupts can find their way into the good graces of licensed money lenders if they have received a letter of discharge.
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