Getting Cash Fast: Fast Cash, Personal, or Payday Loans?
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As far back as 2015, the total amount of loans given to non-bank customers reached almost 1.2 million according to the Singapore Government’s Open Data Portal. This suggests a significant demand for non-bank loans in the country, which in turn has given rise to a variety of alternatives for Singaporeans to get loans.
This blog will provide a basic overview of some non-bank options, especially for getting emergency cash loans fast.
A Fast Cash Loan is borrowed money that can be disbursed almost immediately after approval. This makes it perfect for those who are looking for a way to borrow money quickly.
After approval, the money can be collected as cash or deposited to an account within the day. A fast cash loan in Singapore is a quick and straightforward process. It involves filling out application forms and presenting the needed requirements to your chosen institution.
According to the Ministry of Law, if the borrower’s annual income is no more than S$20,000 then one can take out a loan of up to S$3,000. An annual income of more than S$20,000 can get up to 6 times their monthly income. Additionally, foreigners residing in Singapore have the option to borrow S$500 if their annual income is less than S$10,000.
An applicant can get a bigger loan if they have a higher annual income. Similar to banks, lenders look at the applicant’s ability to repay the loan based on their annual income.
The annual percentage rate (APR) for Fast Cash Loans varies depending on what your chosen lender is offering. Under the Moneylender Rules of 2009, the maximum interest rate that moneylenders can charge is 4% per month or 48% per annum. Because the interest is high as a trade-off for the speed of the transaction, fast cash loans are recommended for very short-term loans, where a borrower’s cash shortfall may just be temporary, or if they just need more than cash immediately.
Fast Cash Loans are ideal for cash emergencies, such as medical bills, rent, or utility bills. Processing time and cash disbursement are faster than most other kinds of loan applications.
Personal loans are lump sums of unsecured money that are often released 2 to 3 business days after approval. “Unsecured” means that the loan doesn’t involve any collateral. Lenders will not have the right to take any assets from the borrowers when they are unable to pay the debt.
Depending on each lending provider’s requirements, a personal loan can be approved from a day to a week. This makes it a good option for pressing financial needs, if the borrower anticipates expenses they will not be able to pay for, or if they plan to spend on travel or home improvement.
A common loan amount that can be borrowed is 6 times the monthly salary provided they have a minimum annual income of S$20,000. Foreigners have required a minimum annual income of S$20,000.
Personal loans tend to come with high interest rates, especially for those who are under the minimum annual income. On average, the interest rate for Personal Loans ranges from 1% to 3.9% per month.
Personal Loans are a good source of funding because it offers a larger lump sum of money to borrowers compared to short-term loans. Processing time may not be as fast and easy as fast cash loans but it can help fund weddings, travel, extensive home renovations, or clearing credit card debt.
A payday loan is a short-term lending option that provides borrowers the money they need until their next paycheck. For some loan providers, the borrowed amount is paid for in post-dated checks, timed to coincide with the borrower’s salary schedule. This makes it a decent option for managing small unexpected expenses like emergency car and house repairs, or to fund bigger expenses that the borrower is confident they can pay back over time with their salary.
Approvals are usually fast, with the money being made available from one to three days. This loan is designed to be small, fast, and accessible for those who the lenders are confident have the means to repay the loan.
The amount you can get varies depending on your income. Moneylenders would require you to present your most recent payslip before settling on a value. Credit history doesn’t affect most Payday Loan applications.
A Payday Loan is a good alternative to getting smaller but urgent cash since applications are approved based on your salary, not your credit history. Because payday lenders usually don’t check a borrower’s credit history, the process can be relatively fast and simple.
Because payday loans are so dependent on your salary, this can be a barrier of entry to some– a borrower’s chances of getting their loan approved is often dependent on their salary, the company they work for, and how long they’ve held their current job. Payday loans can also come with high interest rates for short periods, with interest of up to 4% for one month (compared to most credit cards’ annualized interest of 25%).
Generally, one must be a citizen or a permanent resident of Singapore and is at least 21 years old. Some banks also require applicants to have a minimum annual income of S$30,000. Required documents you might need include:
Requirements for fast cash loans and other lending options may vary depending on what institution was chosen.
Some institutions also take advantage of the Singapore Personal Access or Singpass for instant approval. Banks would pull identity and income information from Singpass directly.
Credit scores are an important factor in getting a loan application approved. Any history of late payments or loan defaults can contribute to bad credit. A bad credit score ranges from 1000 to 1723 as stated by the Credit Bureau Singapore. A credit score in this range will increase the likelihood of the loan application being rejected by most banks.
You can check your current credit score through Credit Bureau Singapore. You can either request a copy of your credit file online or subscribe to the My Credit Monitor (MCM) service. Most licensed moneylenders in Singapore usually have fewer conditions and requirements. It is wise to check in with your chosen financial institution first and know more about how licensed moneylending works.
With enough understanding of the process, getting a cash loan can be quick and easy. Consider working with a trusted financial institution as well to get the best loan terms in your favor.
Capital Funds Investments is a licensed and trusted lender that provides quick cash loans for your financial emergencies. We tailor our loans to suit your financial needs. Get in touch with our trusted counselors today to know more about how we can assist with your financial needs.