Beware the unlicensed money lender!

Business money trap concept

Sometimes, you could find yourself in a situation when you need financial help and very little options to choose from. Fortunately, there are some money lenders in Singapore where you can get your loan applications approved in less than a week. 

Fast cash access is helpful if you need money for emergencies, but make sure you’re not working with unlicensed money lenders.

There are unlicensed and licensed moneylenders all over Singapore. While it’s easy to distinguish one from the other, it’s equally easy to fall into the trap of unscrupulous and unlicensed moneylenders. 

A short overview of unlicensed money lender and their activities 

Licensed moneylending companies provide borrowers with the best possible option that they can avail when they borrow. They have their terms and conditions set up as per what the law in Singapore tells them.

On the other hand, Singaporeans and some foreigners are often the targets of unlicensed institutions that offer loans. These unlicensed money lenders, more often known as loan sharks or Ah Longs, are known for providing extremely high repayment interest rates and highly illegal methods of obtaining their payments when the borrowers invariably fails to repay them back. 

Locals who are desperate for a quick loan often turn to these individuals and groups for help, forgetting that the price of repayment is often very steep and leads to ruin. These are groups of people who have been rejected for loans by banks and other lending institutions, and finding themselves in desperate need of money, would agree to all the terms offered without checking. 

Foreigners who are new to the country without anyone to turn to for help are also one of their targets. With no credit history, the inability to loan large amounts of money from banks, and their uncertainty over who to trust, it makes them even more vulnerable to predation by loan sharks. 

Foreigners often have no recourse for most financial crimes in Singapore. They do not have the resources to cover for the amount of cash that they need for themselves that is why they are being offered a loan package that they can not refuse. 

Singaporean police are doing their best to prevent the troubles of unlicensed moneylenders. They are constantly reminding employees not to borrow cash from these unlicensed and unscrupulous scammers.

Business flat hand hold businessman to put in cage

How do loan sharks operate? 

Loan sharks often victimize the people who are most vulnerable during the times of their difficulties. Harassment may occur over mobile phones, calling the customers constantly, sending SMS or even posting in social media from these unlicensed moneylenders. 

Under the advertising rules made under the Registry of Moneylenders’ Registrar’s directions on Advertising & Marketing Activities of Licensed Moneylenders, a licensed Singapore moneylender is permitted to advertise only through these three channels: 

  • business or consumer directories (in print or online media); 
  • websites belonging to the moneylender; and
  • advertisements placed within or on the exterior of the moneylender’s business premises.

A licensed money lender can only perform certain advertising actions. Anything outside of these are done by unlicensed moneylenders or loan sharks. 

These schemes are not the only recent happenings, as Ah Longs are using increasingly varied ways to obtain their dues. 

With the recent worldwide Covid-19 pandemic happening, loan sharks are stepping up their own activities. A recent news article has unveiled their latest schemes during Singapore’s Circuit Breaker, using food delivery services to harass their debtors. 

In a recent Facebook post, Senior Parliamentary Secretary for Home Affairs Amrin Amin stated that the “police observed a rising trend of unlicensed moneylenders ordering a lot of food or multiple times, sent to the debtor’s or their relatives’ homes with bill unpaid. Our poor deliverers and food places suffer losses. Different tactics, same aim – intimidate, harass, shame.”

Another recent scheme is their use of fake job advertisements online pretending to be from the government seeking stay-home personnel checkers to help enforce Government-issued stay-home notices.

The individuals hired are then taught to harass the public by leaving notes, messages online and their residences in order to intimidate them into payment.

Shadow of trapped male

If You’re Trapped By Loan Sharks, What Can You Do?

Unfortunately, it’s impossible to recoup any cash you might have lost to loan sharks in the past. However, you can stop paying your unfair debt and its interest rates. An unlicensed moneylender has the right to operate using aggressive terms enforcement.

Any form of receipt or billing that verifies the abusive practices of unlicensed institutions is enough to gain help and security from local enforcement. Singapore is rife with loan shark practices, which makes a licensed moneylender such as us at Fortune Credit,  trustworthy.

Here are three things you can do if you’re trapped by unlicensed money lending companies:

Judge wooden gavel on sounding block on the table

1. Notify Law Enforcement

Even if it’s been the first time your unlicensed money lending in Singapore companies changed their terms, talk to local law enforcement if they’ve begun performing online and physical harassment.

Unlicensed and abusive unlicensed moneylenders use shaming methods to urge their borrowers to repay their financing in full.  Unlicensed sharks will often mark Singaporean shops with spraypaint tags. Some even post photos of non-paying borrowers online with their photographs and names.

These activities are all punishable by law because it threatens the security and safety of any borrower and their families. Those found guilty of engaging in loan shark harassment can be fined between $5,000 and $50,000, jailed for up to five years, and get six strokes of the cane.

2. Contact The Monetary Authority of Singapore

Report the loan shark’s name to MAS to ensure they cannot register their name in case the unscrupulous loan shark tries to legalize its name. Furthermore, local law authorities can use the loan sharks’ name to make a blotter and identify the individuals behind the illegal moneylending activities.

The MAS is the only one capable of shutting down and deeming illegal the transactions of all unlicensed moneylenders.

Cyber security and digital data protection concept

3. Change Any Personal Information You’ve Shared With The Unscrupulous Companies

Similar to real life phishing and hacking, change any of your personal information and passwords immediately. If the unlicensed moneylenders have the logins to your SingPass account, report this to their officials to give you a special warrant that allows you to change your password or transfer your pre-existing information into a new account.

If you are a frequent customer of unlicensed moneylenders, you should take note that you are at risk with these unlicensed money lenders because your life might never be the same again. Some people are advised not to borrow cash just to keep up with their finances and just deal with what they have just to ensure that they will not be scammed and unlicensed moneylenders will never bother their lives. 

You can opt to just talk to the one you owe to like the companies for the bill payment, the landlords for your monthly rental, and talk to someone who can help you with the late payment of your mortgage. This way, you can be offered payment arrangements that can give you more time to pay for what you owe.

Always remember these things about moneylenders:

  • If you have friends and family members who can help you with your financial struggle, especially when it’s just short term, ask them for some help it will never hurt. 
  • Before borrowing a certain amount from a lender, try to look for alternatives like contacting the companies where your bill is due and arrange for a payment arrangement that will be more convenient for you. You can also try to contact the government for some options of financial assistance because they offer these most of the time to help people who are struggling.
  • Only apply for a loan that you really need. Do not just apply for a loan to buy something that you just want and not really something that you will be needing. If you borrow a certain amount because you just want to buy something expensive that you want, like an expensive bag, the possibility is that you will be struggling to repay it.
  • If you choose to borrow cash, check twice or more times to know that you are dealing with a legit institution so that you will not have a hard time dealing with them and there will be less chance of harassment.
  • Never forget to read all that is written in the terms and conditions of your loans. This will help you understand the things that you need to do for you to keep a good relationship with the licensed money lender as well as keep a healthy credit score.
  • Keep up with your monthly repayment schedules. This will also help you keep a good credit grade that you will need in the future.

When the time comes that you will need to get a loan, shop around for options that will be more suitable for you and you will never be compromised with their agreement. 

If you’re looking for licensed moneylenders with a heart to help and intends only to help you in all your difficulties, you can never go wrong working with us at Fortune Credit. Contact us today to learn more about everything that we can achieve with you.

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