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SGP Credit - Personal Loan With Low Interest Rate | Escaping the Clutches of Loan Sharks in Singapore: How to Safeguard Yourself

Dealing with loan sharks, also known as “Ah Longs,” can quickly turn into a nightmare, particularly if you’re unaware of how to escape their grasp. These illegal or unlicensed moneylenders often masquerade as licensed money lenders to deceive innocent individuals residing in Singapore. They charge exorbitant interest rates and fees, resort to threats and harassment, and make it nearly impossible for borrowers to break free. However, there are ways to protect yourself from their clutches. In this article, we will guide you on how to run away from loan sharks in Singapore. Keep reading to learn more.

How to Identify Loan Sharks

Recognizing the signs of loan sharks is essential for safeguarding yourself from their predatory practices. Here are eight ways to determine whether you are dealing with a loan shark or a licensed money lender in Singapore:

  1. Check the List of Licensed Money Lenders: The Ministry of Law in Singapore maintains a regularly updated list of licensed money lenders. If a money lender is not on this list, they are likely a loan shark.
  2. Unusually High Loan Amounts: Loan sharks are often willing to lend more than the legal maximum amount without verifying your income stability. This disregard for regulations should raise red flags.
  3. Illegal Advertising: Licensed money lenders are prohibited from contacting you via calls, texts, or emails to offer loans. If you receive unsolicited communication, it is likely from a loan shark. Legal money lenders can only advertise through specific channels, such as directories, their websites, or their business premises.
  4. Lack of Physical Office: Licensed money lenders must have a physical office to meet borrowers and verify their identities. If a money lender conducts business solely online or is evasive about their office location, they are likely a loan shark.
  5. Excessive Interest Rates: Licensed money lenders adhere to interest rate regulations, capping maximum interest at 4% per month on the loan principal and 4% for late payment fees. If a money lender charges rates exceeding these limits, they are operating illegally.
  6. Upfront Administration Fees: Money lenders are not allowed to charge upfront administration fees. Such fees should be deducted from the loan amount when it is granted. If a money lender requests upfront fees, they are likely a loan shark.
  7. Incomplete or Absent Loan Contract: A legitimate money lender will provide a complete loan contract for your review and signature. If a money lender fails to provide a contract or presents an incomplete one, it is a strong indication of loan shark activity. Always read loan contracts thoroughly before signing.
  8. Threats and Harassment:Money lenders are prohibited from using abusive language or engaging in harassment. If you experience harassment, it is likely you are dealing with a loan shark. However, it’s important to note that some licensed money lenders may engage in inappropriate behavior, and you should report such incidents as well.

Consequences of Dealing with Loan Sharks

Refusing to repay a loan shark can lead to severe consequences. Loan sharks may impose exorbitant late payment interest rates, resort to threats and abusive language, stalk borrowers, report them to employers, or even seize personal property by force. In extreme cases, loan sharks may threaten to kidnap borrowers or their family members.

How to Handle Loan Shark Harassment

If you find yourself being harassed by a loan shark, there are steps you can take to protect yourself:

  1. Report to the Authorities: Report the harassment to the police, the National Crime Council’s X Ah-Long hotline, or the Registry of Moneylenders. These authorities will take your complaint seriously and address the issue.
  2. Cease Payments: If you discover that you are dealing with a loan shark after receiving the loan, and you have reported the issue to the relevant authorities, stop making payments to the loan shark.
  3. Do Not Yield to Abuse and Harassment: Although it may be frightening, do not give in to the loan shark’s threats. Yielding only encourages further harassment. Refrain from providing your ATM card or personal details, as assisting a loan shark can lead to legal trouble.
  4. Change Compromised Personal Information: If you believe that your sensitive personal information has been compromised, change relevant account log-ins and consider temporarily moving from your home address to avoid harassment.

Punishment for Loan Sharks in Singapore

Loan sharks are subject to legal consequences for their actions. First-time offenders found guilty of harassment may face:

– Up to five years’ imprisonment

– Three to six strokes of the cane

– Fines ranging from $5,000 to $50,000

It’s important to note that borrowing from a loan shark is also an offense, and individuals who assist loan sharks can face similar legal consequences.

Where to Seek Help

In addition to reporting loan shark harassment to the relevant authorities, several social services can provide assistance:

– MSF ComCare: 1800-222-0000

– Credit Counselling Singapore: 6225-5227

– Arise2Care Community Services: 6909-0628

– Association of Muslim Professionals: 6416-3960

– Blessed Grace Social Services: 8428-6377

– Adullam Life Counselling: 6659-7844

– Silver Lining Community Services: 6749-0400

– One Hope Centre: 6547-1011

Stay Vigilant and Avoid Loan Sharks

By being aware of the signs of loan sharks and understanding how to protect yourself, you can avoid falling victim to their predatory practices. Remember, licensed money lenders like SGP Credit offer safe and reliable loan options with reasonable interest rates and transparent terms. If you’re in need of financial assistance, choose licensed money lenders who adhere to regulations and protect your rights. Contact us today to speak with our loan experts or apply for a loan online.

Post Author: SGP Credit

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