Personal Finance

How Can You Check A Money Lender License?

September 13, 2022

Moneylending is a big business, given the growing number of people seeking immediate financial solutions. 

The prevailing tough economic times occasioned by the Covid-19 pandemic and inflation have driven many to their last coin, hence the need to look for a quick solution in money lenders.

In Singapore, lenders require a moneylending license to operate. However, some still choose to operate without one and oppress unsuspecting clients.

Unlicensed money lenders usually charge unreasonably high interest rates, and their collection methods are unorthodox to say the least. 

That is why it is prudent to ensure that a lender has a license regardless of the need and urgency with which you need a loan. 

Singapore’s Ministry of Law has set regulations for lenders to adhere to before granting a license. These regulations bring order to the industry, as a license is evidence of compliance.

This article will tell you how to check a money lender license in Singapore.

How To Check A Money Lender License

Associating with an unregistered money lender could complicate your financial life, and the Ministry of Law wants to prevent this.

For argument’s sake, one may want to blame the victims for not checking a money lender’s license. However, the lengths unlicensed lenders go through to masquerade as licensed lenders are startling.

Some unlicensed lenders display fake license portraits to fool people looking for proof of licensure. 

Others create social media accounts and websites that are identical to that of a licensed money lender’s to confuse a borrower.

The best way to recognise a licensed money lender in Singapore is by studying its activities. For instance, a licensed money lender will not advertise a loan via an SMS or social media. 

Instead, the lender will meet you in person to verify who it is conducting its business with. 

Another way of recognising a licensed lender is by checking the Ministry of Law’s list of licensed money lenders in Singapore. 

Only the ministry solely manages the list of licensed money lenders in Singapore, and makes changes to it. 

Deception Tactics Used By Unlicensed Money Lenders

Apart from knowing how to check a money lender license in Singapore, you need to be aware of the deception tactics used by unlicensed money lenders. 

They occur in more ways than the ones we previously mentioned. They include:

SMS Deception Tactics

Currently, loan scammers are big on mobile scams, as the users are many. The fraud is silent and is only between the user and scammer. 

For instance, scammers might send an SMS or WhatsApp text to create an impression that they have deposited the loan amount into your account, and you should await further instructions. 

The text acts as a psychological tool against the receiver, and is sent in the hope that he or she will get excited over that possibility and let their guard down.

Scammers may also send a “sorry for the late reply” text, implying that you had earlier contacted them, or a text in the name of a licensed lender to look authentic. 

Another ingenious yet deceptive way they use is sending a text in the pretense of trying to assist in debt consolidation. This text often comes with a promise to stop harassment from other debtors. 

Those who fail to notice the SMS scams mentioned above usually transfer money into some unknown account, only to never hear from the scammers again. 

For more information on loan scams, visit the  Police Advisory on Loan Scams.

Balloon Payment

A balloon payment refers to a significant payment an unlicensed lender may require you to pay at the end of your loan. 

As its name suggests, the amount is usually way higher than your monthly payment, and you might not be able to afford it without refinancing.

The balloon payment is irrational as your monthly payments are supposed to cover the loan and interest.

Loan Flipping

With loan flipping, the lender aims to refinance your loan repeatedly, generating fees that keep you in a loop. This might increase your debt burden so that your income is spent on repayments.

Asset-Based Lending

This is when a money lender allows you to take a loan not based on your ability to repay, but on an asset you have. It also will not consider checking your credit score with the Moneylenders Credit Bureau.

The lender’s predatory lending practice thrives on the expectation that you will fail to repay the loan so it can take over your asset. 

Examples of an asset are a home or car – something that will have an immediate impact on your stability.


An unlicensed money lender might lead you to an expensive loan even when there is a less expensive one.

What Licensed Money Lenders Cannot Do

A legal money lender in Singapore operates guided by a code of conduct and ethics in the Moneylenders Act. 

As such, there are some things they cannot do even if the borrower can’t repay the loan. They include:

Intimidation, Harassment, or Threats

In Singapore, the Protection from Harassment Act of 2014 prohibits anyone, including a lender, from:

  • Using any threatening, insulting, or abusive words or behaviour
  • Making any threatening, insulting, or abusive communication
  • Publishing information regarding the identity of any person or a related person

This is why you will not find a legal money lender in Singapore calling a borrower’s family members and friends to solicit money from them.

Injuring the Borrower

This is a criminal offense, punishable by the law. A licensed money lender will not physically harm you or the people close to you.

In Singapore, even a minor injury is punishable by up to six weeks in prison. Therefore, kicking, slapping, or punching a borrower is not allowed.

If a lender tries to harm you, you should contact the police at 999 immediately.


This involves activities such as:

  • Following a borrower or someone related to him or her
  • Surveilling your work or home areas
  • Sending, giving, or leaving things for the borrower to find

A licensed money lender will call you during business hours and only send legal documents through the appropriate channels. Spam calling is also unethical and considered stalking.

Vandalising Property

In Singapore, the Vandalism Act of 1966 prohibits anyone from drawing, writing, marking, painting, or inscribing on public or private property without written consent from the state or owner.

Hence, a licensed money lender cannot vandalise a borrower’s property. Hefty fines or jail terms await those who do.

Collecting Using A Mob

Debt collecting using a mob is disruptive, inconsiderate, and illegal. Organising a mob to bang at a borrower’s door is a sure sign of an unlicensed money lender.

How Money Lenders Apply For Their Licenses

The Registry of Moneylenders requires money lenders to pay a non-refundable fee of $600 during license application.

The applicant must also have passed the moneylender’s test, which they register for online. Applicants pay a $130 fee for one sitting, and anyone can register.

Other requirements stipulated in the Moneylenders Rules 2009, the Moneylenders (Prevention of Money Laundering and Financing of Terrorism) Rules 2009, and the Moneylenders Act (Cap.188) also apply.

Currently, the Registry of Moneylenders has discontinued the issuance of new moneylending licenses. 

Updating Or Renewal Of A Money Lender’s License

Updating the particulars of a moneylending license is pretty straightforward. 

The renewal or amendment is done via an online application. All you need to do is to log in and find your license.

The possible types of amendments one can make include:

  • Change of name
  • Change of address
  • Change of contact details
  • Appointment of a managerial entity
  • Employment or cessation of individuals (usually high-ranking)
  • Transfer or allotment of shares

Regarding a change of address, the lender must get an approval letter from the landlord/lady of the new premises and photographs of the place. 

If the location is suitable, the Registry will ask for a few other documents before the final approval. The documents include:

  • Photos of the signage for the business premises
  • Copy of strata title or property deed 
  • Tenancy agreement

The transfer or allotment of shares also requires disclosure of specific details, some of which include:

  • Number of shares for transfer or allotment
  • Reason for transfer or allotment
  • Identification card of the transferee or transferor and their relationship
  • Share transference price
  • Evidence of the source of funds used

Criteria For Excluded Money Lenders

An excluded money lender solely gives loans for specific purposes. 

They offer loans to trustees of real estate investment trusts, limited liability partnerships, accredited investors, corporations, and trustees or trustee-managers of business trusts.

According to the Moneylenders Act, an excluded or exempt money lender can carry out lending without requiring a license. The lender, however, must first obtain a certificate of exemption. 

To be eligible to apply for the certificate, the business must have a Unique Entity Number (UEN). 

The Ministry of Law determines the fees for the certificate of exemption.

Many Ways To Check If A Money Lender Is Licensed

When dealing with a licensed lender, you won’t need to worry about your health, property, and dignity. 

However, when dealing with unlicensed lenders, anything goes. This is why you must know how to check a money lender license, and ascertain if a lender is licensed. 

At GS Credit, we guarantee urgent and sensible financial solutions to your immediate problem. Our convenient loan packages have low interest rates with no hidden fees. 

Our loan application processes are fast and happen in three simple steps: fill out an online application, submit it, and head down to our office to sign the loan contract. 

For on-the-spot disbursement at competitive rates, contact us at +65 6563 0321 or email [email protected]. Or apply for a loan with us now – it just takes a few minutes. 

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