What Is The Money Lender Credit Bureau?
September 19, 2022
Borrowers (especially first-time borrowers) often think their loan applications solely depend on their ability to repay and loan intention. Well, this is not entirely the case.
Money lenders conduct a comprehensive analysis before deciding what a borrower qualifies for in terms of a loan. The analysis mainly focuses on the borrower’s loan limit and history.
A borrower’s loan history is essential as it contains information on active loans, repayments, and outstanding balances.
This information helps money lenders make more informed lending decisions while steering clear of defaulters.
Recent studies showed that adults in Singapore borrow 18 times their monthly income on average from money lenders.
As a result, money lenders operating in Singapore need an updated borrower’s loan information record for effective decision-making.
The Moneylenders Credit Bureau (MLCB) is Singapore’s loan information management system for money lenders.
The MLCB brings to light all relevant financial data on borrowers to improve the lending experience and end misinformation.
If you’re still wondering what is a money lender credit bureau, this article highlights everything you need to know about the MLCB and how its report may affect you as a borrower.
What Is The Moneylenders Credit Bureau?
The MLCB is a principal repository for all loan information from money lenders licensed in Singapore. The repository contains the borrower’s information on loan requests and repayments.
It was created in Mar 2016 under the Ministry of Law and is mandated to update, safeguard and manage borrowers’ information for money lenders.
The Ministry of Law tasked the DP Information Group (DP Info) with designing and developing the MLCB. It also made DP Info responsible for implementing every MLCB amendment as per the Moneylenders Act.
The DP Information Group is still responsible for developing, preserving, and securing the MLCB.
How The MLCB Works
Licensed money lenders in Singapore are contributing members of the MLCB.
As members, the law requires them to collect and share the borrower’s loan information with the MLCB for better industry management.
Once they share the various moneylender reports, the MLCB compiles and stores them as a loan information report or credit report for a particular borrower.
Loan Information Report
A Loan Information Report details a borrower’s loan information by various licensed money lenders.
A borrower’s credit card loans are not reflected on the loan report by the MLCB. Only loans from licensed money lenders are.
The Loan Information Report is essential for both money lenders and borrowers.
For money lenders, the report allows them to assess borrowers’ creditworthiness for better loan management.
As for the borrower, the report prevents them from accumulating more debts they may not be able to pay.
A borrower can get the report at any moment, at a minimal charge.
What Is Included In A Loan Information Report?
Here is a breakdown of the details captured in a loan information report:
Borrower’s Details And Work Data
Such details include the NRIC, name, and Unique Entity Number, if applicable. The data also provides work details and the monthly income of the borrower.
This portion is for borrowers who wish to be left out of unsecured personal loan applications.
The loan type is probably the most essential part of the report as it details a borrower’s active loans with the licensed money lenders.
Here, a lender can view a breakdown of the total payable amount, total outstanding balance, and reverse sum.
Payment Status And Legend
The payment status portion shows a borrower’s repayment standing over 12 months.
If a borrower makes prompt repayments, the lender will see that and is likely to give higher loan offers as a result.
This section covers only unsecured loans with licensed money lenders.
How Often Is The Loan Information Report Updated?
Currently, the world is experiencing unprecedented economic instability. Inflation has hit a mark never seen before, and the income of many is still the same, if not lower.
Thus, people are willing to do almost anything to survive, including lying on their loan applications or taking up several loans at once.
The loan information report helps address this need to protect the money lenders.
In Singapore, updates on a borrower’s records happen almost immediately or daily when a licensed money lender submits the relevant details to the MLCB.
Who Can Access The Report?
The MLCB report is available only to four parties:
- The Ministry of Law
- The Registry of Moneylenders
- Licensed money lenders
No third party or unauthorised persons can access this report for loan purposes.
How Does the Report Affect You As A Borrower?
Firstly, the MLCB uses the report to limit the number of loans a borrower can access at a given time.
This discourages borrowers from taking on simultaneous loans from different money lenders, only to default on payments.
Secondly, the report determines the creditworthiness of a borrower.
The money lender uses it to calculate the probability of the borrower repaying the loan on time, based on the repayment history.
The report also allows money lenders to calculate the repayment fees for a loan to a particular borrower.
The information allows them to aggregate the amount one can pay monthly and the interests payable. Borrowers are likely to default on payments when their monthly rates are high.
Undoubtedly, a good loan report has a massive positive impact on borrowers. It allows a borrower to gain the lender’s trust and increases the loan limit.
A lousy loan report is likely to attract rejections or meager limits.
How And When To Check The Report
Though one can access their credit report at any time, most borrowers do not concern themselves with it until when they need to take a loan.
However, experts advise checking one’s credit report at least once a year. This helps prevent identity theft that may taint a borrower’s records and result in hefty costs.
Confirming one’s credit report details also helps to evaluate one’s financial position and correct errors.
In Singapore, checking your loan report is a relatively straightforward process. Follow the steps below to access it:
- Navigate to the Singpass site. Create your account if it is the first time. If you already have an account, proceed to sign in.
- On the next page, fill in your details.
- The system will then ask you to choose the credit report you want.
- Depending on the report you select, the site will direct you to the respective agency’s site.
- On the agency’s site, you will have to fill in your personal information again.
- If the information is correct, you will have access to the credit report.
Note that every borrower should access at least one free credit report from the credit reporting agencies.
How To Get A Copy of The Loan Information Report
Now that you know what is a money lender credit bureau report, you can get a complete copy of your Loan Information Report from the MLCB.
If you are within Singapore, visit the MLCB website or call +65 6565 6363 for assistance.
You can also visit the Moneylenders Credit Bureau Office on weekdays during working hours. A minimal fee of $0.50 may apply.
How Can You Improve Your Credit Score?
As a borrower, make sure you only borrow what you can manage to pay.
Have a sound financial plan for the loan and its repayment. If you are unsure, the licensed money lender will advise accordingly.
Also, do not delay your monthly repayments, as there is a record for every loan transaction that will be reflected on the loan report.
Make the repayments as per the dates set on the loan agreement.
If you cannot honour your repayments, consult the relevant agencies for loan consolidation and advice. Do not go silent or default on repayments.
Use The MLCB Report To Your Advantage
Money lenders have made it easier and faster to access loans. However, borrowing beyond your financial ability may cripple you financially.
GS Credit is a licensed and efficient loan provider with affordable loan packages for everyone. We strive to provide the best loan products and advice.
For more information on the MLCB report and borrowing responsibly, contact GS Credit at +65 6563 0321 and [email protected]. Or apply for a loan now.