Need quick cash in Singapore? You’re not alone. Whether it’s an unexpected medical bill, urgent home repairs, or a merchant cash advance for a business opportunity that can’t wait, many Singaporeans find themselves needing quick access to funds.
The good news? You have more borrowing options today than ever before. While traditional banks remain a popular choice, licensed money lenders have become an increasingly trusted alternative for short term loans. In fact, alternative lending in Singapore is growing rapidly year after year, showing that more people are choosing these flexible financing options.
This shift makes sense – sometimes you need money quickly, without the lengthy processes that traditional banks often require. But with so many options available, how do you choose the right one? That’s exactly what this guide will help you figure out.
Understanding Short Term Loans in Singapore:
What is a Short Term Loan? Think of a short term loan as a quick financial boost to help you through immediate needs until your next paycheck. Unlike long-term loans that you repay over years, short term loans are designed to be repaid within a few weeks to 12 months. They’re simpler, faster to process, and often come with more flexible requirements.
How Short Term Loans Work:
- You can borrow based on your income and status in Singapore
- Repayment is usually between 1 to 12 months
- Interest rates are regulated for your protection
- Approval can be as quick as less than 1 hour with some lenders.
Types of Short Term Loans You Can Get
Personal Term Loans:
These loans offer structured monthly payments with a clear end date, potentially allowing you to secure a lower interest rate. They’re perfect for planned expenses, home renovations, or consolidating smaller debts. With fixed repayment schedules, you’ll know exactly how much you need to pay each month.
Payday Loans:
A payday loan provides quick cash that you repay when you receive your next borrower’s payday salary. While they offer fast approval and minimal requirements, they typically come with higher interest rates. These loans work best for very short-term cash flow gaps.
Emergency Cash Loans:
When unexpected expenses hit, emergency cash loans provide the fastest approval with minimal paperwork. These loans are designed for urgent situations like medical emergencies or urgent repairs, offering flexible repayment options to suit your situation.
Business Term Loans:
Specifically designed for company expenses, this type of loan, known as business term loans, provides larger amounts to help with cash flow, inventory purchase, or business expansion. These loans come with terms tailored to business needs and revenue patterns.
Comparing Your Borrowing Options For Short Term Loans
When looking for a short term loan in Singapore, you’ll mainly choose between licensed money lenders and banks. Let’s compare their key features to help you make the right choice for your situation.
| Features | Licensed Money Lenders | Banks |
| Approval Time | As fast as within 1 hour | 2-5 working days |
| Documentation | Basic requirements | Extensive requirements |
| Credit Score | Flexible requirements | Strict requirements |
| Fund Disbursement | Possible same day | 1-3 days after approval |
| Interest Rates | Up to 4% monthly (regulated) | From 6% p.a. |
| Service Type | Personal consultation | Standard processing |
| Loan Amount | Based on income criteria | Usually higher limits |
| Online Application | Available | Available |
Making Your Choice
Your decision should depend on three main factors:
Urgency: If you need funds immediately, a licensed money lender can process your loan within hours. Banks typically take several working days.
Loan Amount: For smaller amounts with quick approval, licensed money lenders are often more practical. For larger sums, banks might offer better rates.
Personal Requirements: If you have a less-than-perfect credit score or need more flexible terms, licensed money lenders generally offer more accommodating options.
How Much Can You Borrow?
Understanding how much you can borrow is crucial before applying for a short term loan in Singapore. Your maximum loan amount depends on your annual income and residency status, with different limits for Singapore Citizens, PRs, and foreigners.
Borrowing Limits for Singapore Citizens & PRs
| Annual Income | Maximum Loan Amount |
| Less than $10,000 | Up to $3,000 |
| $10,000 to $20,000 | Up to $3,000 |
| $20,000 and above | Up to 6 times monthly income |
Borrowing Limits for Foreigners
| Annual Income | Maximum Loan Amount |
| Less than $10,000 | Up to $500 |
| $10,000 to $20,000 | Up to $3,000 |
| $20,000 and above | Up to 6 times monthly income |
Income Requirements
Your income plays a crucial role in determining not just how much you can borrow, but also whether you qualify for a loan. Most licensed money lenders in Singapore require:
- Minimum monthly income of $1,500 for Singapore Citizens and PRs
- Minimum monthly income of $2,000 for foreigners
- Regular employment or steady income source
- Recent payslips or income statements
Total Debt Servicing Ratio (TDSR) Considerations
The TDSR is another important factor that affects your borrowing limit. This ratio ensures you don’t take on more debt than you can handle. Under TDSR guidelines:
- Your total monthly debt payments shouldn’t exceed 55% of your monthly income
- This includes all your existing loans (housing, car, credit cards)
- Short term loan repayments must fit within this limit
Understanding these limits helps you plan your loan application better and avoid wasting time applying for amounts you may not qualify for.
Application Process & Requirements
Getting a short term loan in Singapore varies depending on whether you choose a licensed money lender or a bank. Here’s a detailed comparison to help you understand what to expect.
Basic Eligibility Requirements
| Criteria | Licensed Money Lenders | Banks |
| Age | 21 to 65 years old | 21 to 65 years old |
| Minimum Income (Locals/PRs) | $1,500/month | $20,000-$30,000/year |
| Minimum Income (Foreigners) | $2,000/month | $40,000-$60,000/year |
| Credit Score | More flexible | Good credit required |
| Employment | At least 3 months | At least 12 months |
Required Documents
| Document Type | Licensed Money Lenders | Banks |
| Identity Proof | NRIC/Passport | NRIC/Passport |
| Income Proof | Latest 1-3 months’ payslips | Latest 3 months’ payslips |
| Employment Proof | CPF/Employment letter | CPF statements (12 months) |
| Address Proof | Recent utility bill | Recent utility bill |
| Bank Statements | 3 months | 3-6 months |
| Additional Documents | Usually not required | Income tax, credit card statements |
Application Process Comparison
Licensed Money Lenders:
- Quick online or in-person application
- Basic document verification (Less then an hour)
- Same-day approval possible
- Simple loan contract review
- Immediate disbursement after signing
Banks:
- Online/branch application with detailed forms
- Thorough credit assessment (2-5 days)
- Additional documentation may be requested
- Formal approval process
- Disbursement after cooling-off period
Tips for Faster Short Term Loan Approvals:
With Licensed Money Lenders:
- Visit during business hours
- Bring original documents
- Be prepared for in-person verification
- Have a clear purpose for the loan
With Banks:
- Complete all forms accurately
- Provide comprehensive documentation
- Maintain good credit score
- Keep follow-up contact details ready
Understanding Costs & Repayment
Before taking a short term loan, it’s important to understand exactly how much it will cost you. Here’s a breakdown of all the fees and charges you need to know about.
Interest Rates:
Licensed Money Lenders:
- Maximum 4% monthly interest (set by MinLaw)
- Interest calculated on reducing balance
- Transparent rate structure
- No hidden charges allowed
Banks:
- From 6% per annum (EIR can be higher)
- Interest usually lower for longer terms
- Rates vary based on credit score
- Special rates for existing customers
Fee Structure
| Type of Fee | Licensed Money Lenders | Banks |
| Processing Fee | Up to 10% of loan amount | 1-3% of loan amount |
| Late Payment | Maximum $60 per month | 2-5% of overdue amount |
| Early Repayment | Usually no penalty | 1-3% penalty may apply |
| Insurance | Not required | May be required |
Repayment Options:
Making your loan repayments is convenient and flexible. Most licensed money lenders in Singapore accept various payment methods including GIRO, bank transfers, PayNow, and cash payments at their office. You can choose the method that works best for you.
Your repayment schedule will be clearly outlined in your loan contract. While monthly payments are most common, some lenders offer weekly or bi-weekly options to help you manage your finances better. Remember to always get a receipt for your payments and keep track of your remaining balance.
It’s important to mark your payment due dates and ensure you have sufficient funds in your account to avoid any late payment fees. If you expect any difficulties making a payment, it’s best to inform your lender early to discuss possible arrangements.
Important Things to Note:
- Always get a receipt for payments
- Keep track of your remaining balance
- Mark payment due dates on your calendar
- Inform lender early if you expect payment issues
- Consider early repayment to save on interest
Safety & Legal Guide
Borrowing from licensed money lenders in Singapore is safe when you understand your rights and know what to look out for. Here’s your protection guide for 2025.
How to Verify Licensed Money Lenders
Always check if a money lender is licensed before applying:
- Visit MinLaw’s official registry
- Verify the license number
- Check the registered business address
- Confirm operating hours
Red Flags to Watch Out For:
- Lenders advertising through SMS or WhatsApp
- Requests for upfront fees before loan approval
- Failure to explain all terms and conditions
- Pressure to sign documents immediately
- Refusal to provide loan contract copies
- Requests for SingPass or bank account passwords
Choose Your Short Term Loan Partner Wisely
Getting a short term loan in Singapore doesn’t have to be complicated. Whether you choose a licensed money lender or a bank, understanding your options and rights helps you make better borrowing decisions.
Remember these key points:
- Only borrow from licensed lenders
- Know your loan costs upfront
- Understand your repayment obligations
- Keep all loan documentation
- Reach out early if you face difficulties
At EZ Pte Ltd we understand that each borrower’s situation is unique. As a MinLaw-licensed money lender with years of experience, we take the time to understand your needs and help you find the most suitable loan option with manageable repayment terms.
Need expert guidance for your short term loan? Contact us or apply for a loan now and get pre approved within an hour.
