It’s normal to be stressed when you’re gathering funds to resolve a personal emergency. Unfortunately, you become a target for loan or moneylender scams as criminals believe you’re vulnerable. We’ll show you how to identify such scams, and protect yourself and your funds.
Read on for the full scoop.
What are loan or moneylender scams?
Loan scams and moneylender scams are tactics deployed by scam syndicates or unlicensed moneylenders. Essentially, these scams offer loans with terms that are too good to be true. For example, instant approvals without background checks.
As mentioned above, people under stress because of an emergency are easier targets. They may not have the capacity to check the loan, and simply accept it. Ditto for unsuspecting folks, who might be lured in by criminals posing as licensed moneylenders.
What do loan and moneylender scams look like?
Criminals deploying moneylender scams in Singapore are increasingly sophisticated. However, there are telltale signs that it’s a scammer approaching you. These include:
1. The company not being an authorised moneylender
There’s a full list of licensed lenders the Ministry of Law keeps up to date. If someone approaches you with a loan offer and their company isn’t on this list, don’t reply.
2. The lender advertises on a prohibited channel
Current regulations dictate that licensed lenders can only advertise in:
- Business/consumer directories in print and/or online media
- Websites belonging to them
- The interior and exterior of their business premises
If you see an advertisement from a “legalised moneylender” outside of these channels, ignore it. It’s a moneylender scam waiting to happen.
What are some past loan and moneylender scams in Singapore?
Here are three loan and moneylender scams which happened in Singapore across 2023. Not only are they cautionary tales, but also they’re guides to avoiding scams.
1. Police issued warning about loan scam involving a fraudulent Android app
The Singapore Police Force warned the public about a fraudulent Android app which collected users’ personal data. This data was used by scammers to extort victims after they’re lured in to download the app in order to apply for a loan. Almost $18,000 was lost to this scam.
2. Man jailed for giving in to loan shark’s threats
after falling for a loan shark’s threats when he could not repay his instalments on time. The loan shark demanded access to his bank accounts in return for a lower interest rate. At least one account was then used to carry out more moneylender scams.
3. ‘Fake friend’ scam defrauded $3.2 million in less than three months
Over 900 individuals lost money
to a ‘fake friend’ scam. Although this wasn’t a loan scam from a moneylender, it involved the borrowing of funds. The scammer pretended to be someone the victim knew and asked for cash. They lied that they’re using a new number and that they required money urgently.
How do you tell licensed lenders apart from illegal lenders or scammers?
| Licensed Lenders | Illegal Lenders/Scammers | |
| Interest Rates | Up to 4% a month | Extremely high and stated after funds are disbursed, or exceedingly low with hidden fees |
| Misc. Fees | A clearly listed late repayment fee, upfront administrative fee, and any court-ordered legal costs | Hidden fees without limit, including charges before funds are disbursed |
| Business Conduct | No abuse, aggression, or harassment | Blackmailing, vandalism of property, etc. |
We covered the obvious signs of an illegal moneylender or scammer, but there are additional clues to look for. Should you spot any listed above, immediately walk away from the lender as it’s most likely a scam.
How can you protect yourself from loan and moneylender scams?
Preventing yourself from falling for scams
If you wish to borrow from a licensed lender, you can view the full list of companies and their contact details on the Registry of Moneylenders’ website. Remember, if a firm isn’t on the list, do not trust it. Additionally, this list is also handy for avoiding any blacklisted moneylenders who have flouted the rules before.
Additionally, don’t download any software just to apply for a loan. All loans from a licensed lender can be applied for on its website or in person at its office.
What to do if you’ve fallen for a loan or moneylender scam in Singapore
If you’re a victim of a loan or moneylender scam, make a police report or call 999. If you’re a victim of a loan shark, the National Crime Prevention Council has a specific hotline: 1800-924-5664. Additionally, contact your bank. You will most likely be required to lock down your account and any relevant cards.
Lastly, don’t panic and give in to more of the scammer or loan shark’s demands. Ensure you do not transfer any funds or disclose more personal details.
In closing
Loan and moneylender scams in Singapore are scary. However, there are signs you can identify till today, thanks to the detailed regulations Singapore has regarding licensed money lending.
Should you require funds urgently, stay calm and trust 1-Cash. We’re a licensed lender who’s been in business for almost two decades. You can start your application here and our experienced loan officers will guide you through every step of the way, no matter if it’s a business loan or monthly loan.
Rest assured we’re here to help you overcome your financial emergency!
