Taking out a quick loan from a money lender can make you feel nervous, and for good reason. You’ve probably heard of horror stories where borrowers were severely harassed, leaving them traumatised for life.

Some even faced the wrath of loan sharks, and feared for their family’s safety.

However, a licensed money lender in Singapore would never do these things – not even when you fail to repay thousands.

In this article, we’ll look at what a licensed money lender can and cannot do, and where you can get help for licensed money lender harassment.

What Licensed Money Lenders Can Do

The Ministry of Law (MinLaw) regulates the activities and operations of licensed money lenders in Singapore, from drafting to enforcing the laws and regulations.

These rules are outlined in the Moneylenders Act, which all licensed money lenders in the country must adhere to. These rules include securing the privacy, integrity, and confidentiality of borrowers’ personal information.

Typically, the task of collecting debts or chasing after debts is delegated to debt collection agencies that, on behalf of the licensed money lender, will chase for money owed.

The debt collection agencies have to comply with the sector’s Code of Ethics set by the Credit Collection Association of Singapore (CCAS).

The CCAS was set up in 2014 to counter the impression that the moneylending sector employs extreme violence or scare tactics on borrowers who fail to repay their loans.

Therefore, you must familiarise yourself with the existing laws to protect yourself from potential unscrupulous lending tactics by debt collectors or licensed money lenders.

If you’re unable to pay a licensed money lender in Singapore, it can do the following:

Speak To Your Loved Ones About Your Debt

A debt collector or a licensed money lender cannot harass or threaten your family so that they’ll repay your loan.

However, they can call your friends, family, or relatives and tell them about your loan. They can also call your home and ask to speak with you.

Negotiate Repayment Terms

Debt collectors or licensed money lenders in Singapore can help to mediate and negotiate your loan repayment plans. You can propose a new installment repayment plan, or they can provide you with repayment solutions.

What Licensed Money Lenders Cannot Do

You’ve probably heard of horror stories of loan sharks banging on doors, hurling insults, and spraying ‘O$P$’ outside the homes of borrowers who can’t pay up.

Fortunately, licensed money lenders and debt collectors in Singapore must comply within the CCAS’ Code of Ethics.

This code is a guide, so you must be familiar with any illegal actions a licensed money lender might try to subject you to.

Note that a licensed debt collector or money lender in Singapore cannot:

Threaten, Intimidate Or Harass You

Under the Protection From Harassment Act, a money lender or a debt collector cannot threaten to harm you or your family or intimidate you with vulgarities.

In the Act, it’s illegal to use abusive, insulting, and threatening words or behaviours to cause distress or alarm.

Suppose money lenders or debt collectors threaten to destroy your home or injure you. In that case, they may be liable under the penal code for criminal intimidation.

Singapore’s money lenders or debt collectors are not allowed to lay a hand on you or use verbal threats. Even a small gesture of intimidation can be reported.

Stalk You

Money lenders or debt collectors in Singapore cannot persistently follow and monitor your movements, as this can be an act of unlawful stalking under the Protection From Harassment Act.

Such an act is prohibited by law, especially if its aim is to alarm, distress, or intimidate you.

Cause Injury

Causing an injury to anyone is a severe crime in Singapore. Suppose a debt collector or a money lender in Singapore inflicts any harm on a borrower until he or she is wounded or becomes unconscious.

In that case, the perpetrator may face imprisonment of up to two years, a $5,000 fine, or both. For causing grievous hurts such as dislocations, disfigurements, or fractures, the offender would be imprisoned for 10 years, fined, or caned.

Vandalise Your Property

It’s a serious offense under the Vandalism Act to write profanities or splash paint on public spaces and doorsteps. This includes hanging banners or pasting notices of debt collections around the borrower’s workplace or home.

Any action aimed at embarrassing the borrower could also be considered mischief under the law and can attract a fine of about $1,000.

Damage Or Seize Control Of Your Property

Some money lenders and debt collectors may intimidate borrowers by saying they will damage or seize their homes, cars, and other possessions if they don’t pay up.

It’s important to note that without a Writ of Seizure and Sale from Singapore courts, even licensed money lenders cannot take away any of your property. Moreover, a debt collector or a money lender is prohibited by law from damaging your property.

Doing so will mean the offender has broken the Penal Code, which will attract a fine, imprisonment of up to one year, or both.

This applies even to property that’s not entirely damaged but which has sustained damage that reduces its usefulness or value.

Engage In Unlawful Assembly

An unlawful assembly is a group of at least five individuals who come to your home mob-style to intimidate you.

Therefore, a money lender cannot show up with his partners early in the morning, acting all tough and asking you for money.

Be aware that this constitutes unlawful assembly and can result in jail time. Even a gathering of three or four people can also be termed as intimidation or harassment.

What Some Debt Collectors May Resort To

Money lenders in Singapore sub-contract debt collection companies to retrieve money from people who can’t repay their loans.

MinLaw allows them to do that, so it’s completely legal. Some debt collectors may even help you.

A good debt collector can help you relook your loan terms and provide solutions when you discuss your financial situation with him or her.

On the other hand, some debt collectors may resort to contacting your family and friends, calling you, dropping by your office or home, or contacting you on social media.

Some may also use mild scare tactics to get you to repay your loan.

Where To Get Help If A Money Lender Harasses You

As discussed above, a licensed money lender or debt collector in Singapore cannot harass or use violence against you.

So if you cannot repay your loan and a debt collection agent contacts you, he or she most likely comes in peace.

Always try renegotiating your contract and loan terms. However, if the debt collector uses outright violence and intimidation tactics against you or your loved ones, this is considered licensed money lender harassment.

Here is where you can get help if a money lender harasses you.

Contact The Police

If you feel threatened, call the police or send a text message if you cannot speak. The police will inform you if the money lender or debt collector broke the law and what actions you should take.

For instance, you can ask for a protection order against the offender.

The police’s emergency number is 999, but you can also use their emergency SMS number, 7199, or a police hotline for crime-related information at 1800-255-0000.

Contact The Credit Collection Association Of Singapore (CCAS)

CCAS will help you and your licensed money lender reach an agreement because the organisation can assist with mediation.

However, your licensed money lender or debt collector must be its member for CCAS to intervene. Unfortunately, it cannot help you if you borrowed money from a loan shark or fell for a loan scam.

Negotiate A Repayment Plan With Your Money Lender

Renegotiating your loan terms is a win-win solution for you and your licensed money lender. Paying your debt ensures your credit rating is not too affected so that you can still use the services of other credit facilities.

On the contrary, filing for bankruptcy damages your credit rating, although it saves you from legal action.

Secondly, your licensed money lender will get its money back.

Contact The Registry Of Moneylenders

The Registry of Moneylenders can assist if a licensed money lender harasses you or if you notice illegal behaviour such as not providing receipts, very high interest rates, etc.

Explore Other Alternatives

You can also:

• Ask your debt collector for help
• Contact Credit Counselling Singapore, a non-profit organisation that offers expert advice and support to those in debt
• Opt for the Debt Repayment Scheme (DRS) if you owe less than $150,000 – you’ll get five years to repay your debt

Always make sure you take a loan that you can pay and know how to settle a licensed money lender. Never suffer licensed money lender harassment in silence.

Avoid illegal money lenders and loan sharks and ensure a debt collector has a license. If you need a loan, try licensed money lender Horison Credit.

With us, you can get quality loans with the best terms that suit your specific financial situation. Horison Credit absolutely will not stand for any sort of misbehaviour towards our customers. As a licensed money lender, we respect all our clients and believe in talking through repayment options with them.

Contact our experienced loan officers now, who will be more than happy to assist you. Or apply for a loan today.