Personal Finance

Where Can You Get Help For Licensed Money Lender Harassment?

December 22, 2022

Licensed money lenders can be a good option when you need funds urgently. But like everything else, there are good and bad hats in the industry.

Although they are not allowed to do so, some licensed money lenders in Singapore harass, threaten, or intimidate their borrowers. As a result, moneylending regulations that aim to protect borrowers were drawn up to guard against licensed money lender harassment.

In this article, we’ll talk about what a licensed money lender is allowed to do or not do in Singapore’s moneylending sector. The rules and regulations also provide solutions for borrowers who want to seek help for licensed money lender harassment.

What Licensed Money Lenders Can Do

The Ministry of Law uses the Moneylenders Act and Moneylender Rules to regulate the moneylending industry in Singapore.

It constantly checks and reviews these regulations against the prevailing industry standards for developing sound moneylending practices for the sector.

These moneylending regulations address privacy, confidentiality, and integrity issues affecting licensed money lenders and borrowers. Licensed money lenders are well acquainted with these regulations. Of course, some may intentionally break these rules.

The best way to protect yourself from predatory moneylending practices is to be aware of what a licensed money lender is allowed to do under these moneylending regulations.

Here are some acceptable things that licensed money lenders can do when collecting debts from borrowers.

Use Debt Collection Services

Should a borrower persistently default on monthly repayments, a licensed money lender can employ the services of a licensed debt collector in Singapore to speak to a borrower’s friends or family. The friends and family members listed as guarantors by the borrower are usually the first points of contact.

Debt collectors may also inform the borrower’s employer of the loan situation. They are permitted to visit a borrower’s work premises.

Outsourced debt collectors are usually passionate about debt recovery and helping borrowers. Thus, most of them possess excellent mediation and negotiation techniques.

In addition, debt collection agencies have a Code of Ethics that they must comply with. The Code of Ethics is set and enforced by the Credit Collection Association of Singapore (CCAS).

It stipulates that debt collection agencies do not use violence or scare tactics against borrowers and their relatives or friends.

Note that the Code of Ethics does not prohibit debt collectors from contacting borrowers on social media, calling them, dropping by their home or office during reasonable hours, or talking to their friends and family members.

Negotiate Better Loan Repayment Terms

When a borrower is willing to pay but unable to, licensed money lenders may negotiate other loan repayment terms within the borrower’s means.

The money lender can propose a repayment plan. If the plan is acceptable and the borrower accepts it, it becomes the new loan agreement.

Conduct Follow-Ups

Licensed money lenders may occasionally contact borrowers on the phone during business hours to ask about repayment. They may also send an email or letter through the appropriate channels or visit a borrower at work.

What Licensed Money Lenders Cannot Do

Even if you cannot repay your loan, it should not warrant licensed money lender harassment. As cordial as the debt approval process was, so should the debt collection procedure.

Here are some things a licensed money lender should not do when collecting money from borrowers.

Stalking

Following and monitoring a borrower or his or her loved ones is unlawful in Singapore. The law provides for other effective means of debt recovery other than stalking.

Stalking makes borrowers feel unsafe as they are always looking over their backs. If found guilty of stalking, an individual could be fined a maximum of $5,000, face a jail term of up to two years, or both.

Sending or leaving things in places a borrower frequents is also considered stalking.

Intimidate, Harass Or Threaten

Singapore’s Protection from Harassment Act makes it illegal for any individual or organisation to intentionally:

Harass or alarm a borrower using words or actions
Bring distress to a borrower by issuing threats
Hurl vulgarities or abuse a borrower and his or her loved ones

Contravening the Protection from Harassment Act may result in a fine of up to $5,000 or a prison sentence of up to six months. Making intimidating gestures also counts as a threat.

Injure A Borrower

Some money lenders, usually those that are unlicensed, may go a step further to actualise their threats by injuring a borrower.

In general, causing physical harm to anyone is a serious offence. As per the laws in Singapore, for minor wounds, one could face a jail term of up to two years, be fined up to $5,000, or both.

For grievous injuries such as disfigurement, dislocation, or fractures, one could face a jail term of up to 10 years, a fine, or both. In some instances, caning may apply.

Vandalism

Per the Vandalism Act, any act of writing, drawing, painting, marking, or making inscriptions on public or private property is a crime. Hanging or displaying banners, posters, bills, or placards on a borrower’s property to shame him or her is also an act of vandalism.

If one wants to mark a property for any reason whatsoever, one should do so after getting a written permit from the state or the property owner.

A licensed money lender cannot vandalise a borrower’s property, or risk being fined $1,000.

Taking Property By Force

Regarding the confiscation of a borrower’s property, the law requires the money lender to first present a Writ of Seizure and Sale. A money lender can only issue a Writ of Seizure and Sale after a trial with a court of law in Singapore.

Thus, no licensed money lender of a debt collection agency should attempt to take ownership of the borrower’s property without this process.

Damaging Property

Licensed money lenders in Singapore are not permitted to damage a borrower’s property or cause it to lose its value or usefulness. The damaging of a borrower’s property is punishable with an imprisonment of up to one year, a fine, or both.

Engaging In Unlawful Assembly

Some licensed money lenders may resort to sending a small group of people, usually five or more, to a borrower’s premises or workplace to pressure him or her into making full repayment.

This mob-style debt collection is unacceptable in Singapore and may result in a jail term.

Where To Get Help For Licensed Money Lender Harassment

If you’re currently experiencing licensed money lender harassment, you may feel worried about getting help. You may wonder, what if they come seeking revenge? What if they increase your monthly repayments?

If so, remember that it is illegal for licensed money lenders to terrorise borrowers in Singapore. Such offences are punishable by law. You should contact the following agencies should you encounter any form of intimidation, injury, property damage, or licensed money lender harassment.

The police

Singapore’s police not only have a duty to protect civilians and their property, but also to investigate cases.

So if you require immediate protection from a licensed money lender, you should report it to the nearest police station at 999 or the police hotline at 1800 255 0000.

Other police-affiliated emergency hotlines in Singapore are:

Emergency SMS: 71999
Anti-scam helpline: 1800 722 6688 or https://www.scamalert.sg/
I-Witness e-Service: https://www.police.gov.sg/I-Witness

Credit Collection Association Of Singapore (CCAS)

If a debt collector is a CCAS member, you could report its illegal activities to the agency. If found guilty, it risks losing its debt collector license in Singapore.

However, your licensed money lender or debt collector must be a member of CCAS for the association to help.

However, the CCAS cannot help if you are dealing with an illegal money lender or debt collector.

The Registry Of Moneylenders

Regulatory agencies, specifically the Ministry of Law through the Registry of Moneylenders, take borrowers’ complaints seriously.

The Registry of Moneylenders expects licensed money lenders to:

Explain loan terms to borrowers in the language they best understand. Thus, a borrower knows all the fees applicable and loan tenure before signing on a loan contract
Provide a borrower with a personal copy of the loan contract
Charge no more than a 4% interest rate per month. The interest charged should be on the remaining principal and not the original principal amount.
Not impose additional fees that exceeds the original principal amount
Not ask for your Singpass ID or password. They also should not retain a borrower’s documents, (e.g. NRIC, passport, driver’s license, or ATM card)
Not withhold any part of a borrower’s principal loan amount
Not grant a loan without carrying out due diligence (i.e. face-to-face meet-ups)

Should a licensed money lender act contrary to the above stipulations, you have the right to report it to the Registry.

You can contact the Registry via 1800 2255 529 or visit the Ministry of Law Services Centre on 45 Maxwell Road, #07-11, the URA Centre (East Wing).

Work With The Right Licensed Money Lender

In Singapore, licensed money lenders must adhere to the Moneylenders Act or risk losing their money lending license. This includes respecting borrowers’ privacy and treating them with dignity.

Borrowers also have a part to play in ensuring licensed money lenders act responsibly. As such you should check whether a money lender really has a license before seeking its services. You can do this by checking the list of licensed money lenders in Singapore on the Ministry of Law’s website.

You should also report licensed money lender harassment immediately to the relevant parties. If you are looking for a reliable licensed money lender, consider Credit Thirty3.

As a licensed money lender, our debt collection strategies are professional and legal. We respect every one of our clients and strive to help them. We protect your rights by working with debt collection agencies that do not contravene laws.