How To Fight Loan Shark Harassment?
This guide will help you confirm whether your lender is an unlicensed one. And show you how to fight loan shark harassment.
An unexpected job loss, mounting bills and frayed nerves. A temporary loan from a moneylender seems the only way to stay afloat.
Two months later, you’re back on your feet. The joy is short-lived as the loan shark comes knocking!
The tiny loan has become a debt Godzilla! And the burly men scare your kids!
If you’ve dealt with an unlicensed lender in the past, this story will be familiar.
Despite their ill-gotten reputation, loan sharks in Singapore find desperate victims to fleece.
The high cost of living, unexpected emergencies and some monetary habits have forced many Singaporeans to turn to lenders.
And sometimes, desperation and lack of knowledge lead them to dodgy ones.
Who Are These Loan Sharks?
Loan sharks are illegal or unlicensed moneylenders. They prey on the vulnerable with ‘too good to be true‘ loan schemes.
As we all make emotional decisions even it’s about money, you fail to see the dark side of these loans. Until much later.
These Ah Longs start out friendly for sure. They maintain that pretence as long as your repayments are on time.
But the reality is that you pay a steep price for the loan.
They lend money at exorbitant rates
When the lender is not a reputed one, that personal loan turns into the costliest mistake you’ve ever made.
You end with unfair repayment terms and excessive interest rates. You could end up repaying the interest amount alone forever.
The original loan doubles and triples in no time and pushes you deeper into debt. You’re forced to take new loans to settle old ones.
Sounds familiar? Wondering whether you’ve borrowed from a Singapore loan shark?
Ways to Spot Unlicensed Lenders
If your lender ticks one or more of these boxes, you’ve borrowed money from the wrong bunch.
Loan sharks don’t provide a loan contract
Licensed moneylenders are governed by law. They’re required to provide a proper loan contract and explain the terms in detail.
They’re also expected to maintain necessary paperwork like payment records.
Has your lender failed to provide a proper contract or offered you one with illegal conditions? This is a clear sign they aren’t trustworthy.
With loan sharks, you might end up signing an incomplete or blank loan contract.
Worse still, there is no other paperwork and no explanation of loan terms.
If you suspect you’re dealing with an Ah Long, cancel your loan application.
Avoid any contact with them.
Provide loans without checking your current income
A licensed lender will look into your financial details before issuing a loan. The amount is based on your earning capacity and ability to repay.
Loan sharks, on the other hand, are out to make a quick buck. They will dole out any amount without asking questions.
If you’re currently in talks with one such lender, step back. Search for a better source of funds.
If you take up their offer, …
You pay high interest rates and hidden charges
The Moneylenders Act puts a cap on interest rates and other fees.
Licensed moneylenders can’t charge more than 4% as monthly interest. Late payment fees can’t exceed $60 per month.
Loan sharks aren’t bound by this legal requirement. They charge unbelievable rates of interest, even 40% in some cases.
Their business model is to offer large loans and earn through outrageous interest charges.
Keeping you stuck in a never-ending debt cycle benefits them.
What’s more, they will badger you for repayment at any time they choose.
If you fail to pay on time, …
They use threats and abusive language
Ask any victim of loan sharks. They’ll share horror stories of intimidation, harassment, even physical abuse.
Transacting with such lenders can become a stressful and disturbing experience.
If your monthly payment gets delayed, you’ll be exposed to the worst of human behaviour from them.
Foul language, verbal threats to family, and hints of violence are standard with them.
From subtle threats even before you borrow to abusive actions after you’ve accepted the offer, Ah Long can go all nasty on you.
If you notice these bullying signs in the initial stages, stop right there. Hunt for a professional moneylender.
Some of you may have ignored these red flags and taken up their offer.
How to Solve Loan Shark Problems?
Don’t go by appearances or fall for sweet-talking salesmen.
Confirm the legitimacy of the lender
Ah Long are a smart bunch. They pretend to be legitimate and fool unsuspecting customers.
Do your homework before you seek a personal loan from financers. Your lender should have a government license and a registered office address.
Confirm their genuineness. Verify their details from the online list of registered moneylenders.
This works when you’re still seeking a loan. What happens when you’ve borrowed money?
Exercise the following options on how to deal with loan sharks in Singapore.
Report them to relevant authorities
By now, you’re positive the lender is a loan shark. Do the obvious and report them to the authorities.
If you’ve been approached by an illegal lender or unknowingly availed of their services, file a complaint with the Registry of Moneylenders online or call them at 1800-2255-529.
Loan shark helpline in Singapore
You should also report them to the Singapore Police.
The public can call the Police at 999 or the X-Ah Long hotline at 1800-924-5664.
Provide the authorities with the details about the lender and their operations.
If you’ve records of any transactions, give it to the concerned authorities. This will help them start criminal proceedings against such lenders.
Stop Payments To The Lender
After you’ve filed a complaint, stop dealing with the loan shark. You shouldn’t make any new payments towards your debt.
If the lender threatens to send you to jail for non-payment, don’t be scared. Remember these lenders aren’t licensed.
They’re prohibited by law from lending money or receiving payments. Use this information against them.
Is your moneylender’s behaviour getting worrisome?
Stay Calm And Don’t Be Afraid
Let the relevant authorities deal with the loan shark. In the meantime, face the lender bravely.
When they insult, threaten or harass you, don’t lose your cool or give in to their demands.
If they sense your fear, it will embolden them to torture you further.
Are you being followed by the loan shark’s men?
Dial 999 immediately and report them.
Who To Call For Help Before It’s Too Late?
There are many organisations in Singapore that help people in debt.
They assist with debt management, offer credit counselling and provide social assistance schemes.
Contact one of these helplines in Singapore for credit advice or welfare needs:
Do you have existing loans to repay?
Contact these voluntary welfare organisations to help handle your debt:
- Adullam Life Counselling – 6659 7844 / 9423 8832
- Arise2Care Community Services – 6909 0628
- Blessed Grace Social Services – 8428 6377
- One Hope Centre – 6547 1011
Which brings us to the moot question.
How to avoid loan sharks in the first place?
Do your research and find safer ways to get funds, even if you’re strapped for cash and time.
Borrow money only from legitimate sources who offer the best terms – based on your needs and ability to pay.
Avoid Ah Longs even if you’re running out of loan options.
Don’t act as a guarantor on loans from unlicensed lenders. If the borrower fails to repay, the loan sharks will start harassing you.
Avoid lending your NRIC to anyone. They may use it to borrow money from a loan shark, leaving you to face the music.
Don’t gamble. If you’re addicted to gambling or have a gambler relative or friend, seek counselling. Contact the National Council on Problem Gambling online or at 1800-6-668-668.
Be wary of loan sharks who offers loans through text or WhatsApp messages. Save yourself from unwanted stress by ignoring them. Protect your family from swindlers masquerading as authorised moneylenders.
We hope you find this guide on how to fight loan shark harassment useful.