Be Careful Of Sharks: Why Legal Money Lenders Are Still The Better Option

Man Disputing Loan

Despite having limited land resources, Singapore has established itself as one of Asia’s most competitive economies. It has developed into a well-known financial centre and a growing wealth management hub. Singapore’s strong links with London as well as its effective economic policies have attracted businesses into investing in the country.

The emergence of Singapore as a wealth management hub has led to the establishment of numerous lending entities. The number of legal money lenders in Singapore has grown over the years. As of August 2019, there are 158 money lenders registered with Singapore’s Ministry of Law.

However, many people still choose to borrow money from loan sharks or unregistered money lenders because the process is easier. Loan sharks are lenient when it comes to requirements and they lend money faster than legal lenders. What borrowers don’t know is that they could be sinking themselves into horrendous debt when they borrow money from loan sharks.

High-interest rates

Loan sharks specifically design their payment schemes so that they can enjoy high levels of interest rates. These loan agreements do not take into consideration whether or not the borrower can pay on time. If the payment is set on a weekly basis and the borrower fails to pay, additional charges are incurred for late payments.


Unregistered lenders are not regulated by the government and they do not report their transactions to authorised credit agencies. It becomes difficult to find a course of redress if there are problems with your transactions.

Many loan sharks do not follow legal protocols and do not have the required licenses to operate. They have no legal records and are not bound by any legal agreement. So if you are a borrower with a bad credit history, you will still not be able to improve on your credit image even if you pay them on time.

A never-ending process of borrowing

Borrowing money from loan sharks can be attractive because it seems convenient. However, such convenience might get you trapped in a cycle of never-ending borrowing. You might be tempted to apply for a higher amount than what is needed just because it is readily available for you. And with online loan applications becoming available, it becomes easier and more accessible to those who desperately need the money.

Legal lenders are always the best option

It is always better to borrow money from legal lenders. True, the process is more stringent and it does require more time to actually receive the loan, but the process is there for the protection of the borrower as well as the lender.

Legal lenders are regulated by the law requiring them to report to credit agencies, so paying back a loan improves the credit rating of the borrower and improves their credit history. It is also the case that legal lenders are much more likely to give sound financial advice.

Capital Funds Investment is a trusted legal money lender in Singapore. Whether it is for business or personal purposes, we provide fast loans. Our loans are tailored to suit or clients requirements.

Need cash now?

Apply here to get a loan customised just for you. Contact us if you need more information about our services.

Beware of Loan Predators: Common Loan Shark Scams and How to Avoid Them

Woman handed the pen for signing in loan document

Many foreigners in Singapore find themselves strapped for cash from time to time, especially when they need money for medical emergencies or to pay their bills. These foreigners are in dire need of personal loans to settle their payables, and are, therefore, the most vulnerable to loan shark traps.

Some unlicensed money lenders or loan sharks in the state offer small loans with extremely high interest rates and hidden fees. Their tactics, in fact, have become brazen in recent years, with some targeting unsuspecting victims who have never done business with them directly. These loan sharks even threaten people with violence, charge them large interests, and cause millions of dollars in property damage.

As with all scams, the best defence is knowledge. So, let’s take a look at the common loan shark scams in Singapore and how you can avoid them.

1. The licensed moneylender impersonator

These tech-savvy Ah Longs advertise their ‘service’ through text messages, emails, SMS blasts, Whatsapp and other social media platforms. At first glance, they seem professional and legitimate, putting up a whole facade. Unknown to the common folk, they impersonate licensed moneylenders by using legitimate registration numbers from the Singaporean Monetary Authority. They use important credentials and information illegally, from the business name to the business address and registration number. Be wary when you receive offers about loan programs you never applied for, or be generally vigilant if you’re thinking of taking a loan.

2. The loan collector scam

This scam is pretty simple, but many still fall for it. The loan shark acquires the victim’s phone number and calls them, claiming that the victim has borrowed money and they are asking for repayments. In some cases, they bluff and make up stories, explaining that a third party has cheated the victim and that they are there to get the payment for the lending company.

If the victim refuses to pay, they threaten him/her with consequences, such as assault or vandalism to property. Some people who have borrowed money in the past fall prey to this tactic easily and immediately pay the scammer. If you have borrowed money in the past, call your lender or agent first and verify the call you received.

3. The fee transfer scam

The fee transfer scam is the most dangerous because the loan shark not only takes people’s money but also gains access to their personal information. The Ah Long will text or call the victim, claiming that they have been approved for a loan. The catch is that the victim needs to pay an admin fee before they can take the loan. The scammers will then trick the victim into giving them SingPass access, giving them the means to see personal and private information that they can later use to intimidate or harass the victim.

If they are successful, the loan sharks have scored a huge win. They not only receive the money transfer fee, but they also acquire personal information that they can use as leverage on their victims.

Other tell-tale signs of a loan shark include people who offer to do business without a signed contract. The law requires licenced moneylenders to use contracts for security and accountability. Loan sharks also offer huge sums of money to victims despite the victims’ relatively small incomes. Additionally, if they operate without an office and they’re not listed on the Ministry of Law’s website, they’re most likely illegal moneylenders who charge their victims with exploitative interest rates and fees.

Apply for a Foreigner Loan with Trusted Moneylender Capital Funds Investments

As a foreigner in Singapore, it can be difficult to find a financial institution you can trust to offer you a loan. Capital Funds Investment is Ministry of Law-approved and licensed. We provide foreigners in Singapore with a fair loan, and we never abuse the confidential information that we receive during the application process.

For more information regarding our CFI Foreigner Loan, call us on (65) 6281 7736 or send an email to