Things That A Licensed Money Lender Can’t Do When Collecting Debts in Singapore
If you owe money to your friend or, let’s say to Mrs. Tan from your neighborhood, they can try all kinds of methods to collect their money. But that’s a no-go for licensed moneylenders!
Since lending money is their walk of life, the licensed moneylenders will have to keep it very professional. You don’t have to worry about them chasing you down like loan sharks. Loan sharks are illegal groups in Singapore and are known for harassing their victims. Licensed moneylenders are totally different from them.
So, what exactly can licensed moneylenders do when are collecting a debt? What can they not do?
Once you go through this article, you’ll know if anything wrong is happening to you or not.
What A Licensed Moneylender Cannot Do In Singapore
All of us have heard some awful stories about debt collectors writing on your walls, spraying “O$P$” on your properties, and banging your doors loudly to collect debts. And nobody wants to go through that kind of experience.
Those are loan sharks.
A licensed money lender will always act according to the code of ethics given by the CCAS. So here are the lender’s limitations, things they cannot do to a debtor in Singapore. They are a professional business.
1. No Threats, Harassment, or Intimidation
Singapore follows The Protection from Harassment Act. The rules are loud and clear here. It states, nobody’s allowed to:
- Say something abusive towards you
- Threaten you
- Insult you
- Publish or share your information that reveals your identity
- Call you names
- Cause you any alarm, harassment, or distress
- Embarrass you or cyberbully you online
If you are harassed by loan sharks, here are some ways to deal with them!
2. No Stalking
The Protection from Harassment Act states that the moneylenders won’t be able to stalk you. This includes:
- Following you, whether it’s on the road, or your way home, or when you’re going to some places.
- Stalking someone related to you. For example, Your family member, friends, employees, or employer.
- Staying frequently to a place near your house or the place you’re working in.
- Giving you objects that can be threatening to you
- Waiting for you in your car parking lot
- Watching your place using binoculars
- Spying on you and your family members
However, they can give you a call over the phone during business hours. In fact, they can send you contracts, invoices, or other legal documents. But then again, it has to be pretty formal and scheduled. Even if they contact you through Facebook, Whatsapp or any other social media platform, it would be considered as ‘stalking’.
3. No Inflicting Hurt
Singapore’s government makes sure no one gets physically harmed or injured by anyone. When it comes to minor injuries, if someone abuses you, he’ll get at least 4 to 6 weeks of jail.
Major injuries don’t even come close here. If someone causes you severe injuries, you should report it to the police, and he’ll be jailed for several years.
This doesn’t leave your moneylenders as well. First off, they have no right to use any violence or force on you if they want to collect the debts. If, however, someone abuses you, call 999 immediately to take legal action.
4. No Property Vandalism
Singapore follows The Vandalism Act very strictly. Let it be regular debt collectors or even licensed money lenders; they don’t have the right to draw or write anything in a public area!
Therefore, there isn’t any chance for the lenders to come for your door and splash paint or even stick a notice.
Here are the things they cannot do to your property:
- Draw Caricatures or symbols
- Write any slogan or quotes
- Hang posters
- Pasting stickers and notice
On top of everything, they are not even allowed to write any positive things either. And they are also forbidden from hanging posters outside your workplace or write anything on your car.
If some money lenders do such things, they will be fined up to S$1000 when you file a complaint against them.
5. Damaging Or Taking Your Possessions
One of the most common tricks used by debt collectors is, they will threaten to take away your valuables. Furthermore, some terrible guys will also tell you that they will damage your properties. Even though they do it to scare you, it is totally illegal in Singapore.
If you hear these words from the mouth, you should know these two facts.
- No person in this country can cause damages to your property deliberately. It doesn’t matter that you’re breaking the car window of your ex-partner or trying to collect money from a debtor; you can cause no harm to their valuables. If you do so, you will end up in prison for sure.
- Another thing you need to know about the debt collectors is that nobody can take away your possession from you. Even licensed moneylenders are unable to do that unless they have Writ of Seizure and Sale.
6. Engaging in Unlawful Ceremony
Some debt collectors are inspired by Hollywood movies. They will strike at your door, get an entry, and will try to collect money from you. But them acting like the mafia isn’t legal in Singapore.
The law of this country states that if a group of at least five people is gathered for an unlawful assembly, they are going to prison.
What Can A Licensed Moneylender Do?
Now that you are well aware of what a licensed moneylender cannot do, there are some things they can do during legal debt collection.
In Singapore, there are rules for both of the party to maintain the balance. So here are the things that can be performed by a licensed money lender while collecting debts.
- They can contact your family and let them know about your debt situation. Though, that can be embarrassing sometimes.
- They have the right to call you, and so, they will keep doing that frequently.
What Should You Do When Moneylenders Harass You?
When dealing with an ethical, licensed moneylender, they will do everything according to the rules set by CCAS. However, if they are still making any illegal approaches to you, here are the things you can do.
1. Alert the Police
Suppose the debt collector or anyone is harassing you, threatening to damage your life or property. In that case, you should immediately call the police.
When they are offensive towards you, and their act falls under the Protection against harassment law, you can file a complaint without any trouble. And then you can get a Protection Order against the collector.
When you alert law enforcement, you will be saved from any immediate danger. Additionally, it will give you some time to figure out your debt situation.
2. File a Complaint to CCAS
As you already know that the moneylenders are bound to follow the rules set by CCAS. Therefore, you can make a complaint to the organization to put a stop to the harassment. However, this trick will work only if the lender is a member of that organization.
So if you have borrowed money from a licensed moneylender, you can go to CCAS for support.
However, you cannot benefit from this organization when you have got your money from an illegal lender. This is another reason to stay away from loan sharks!
3. Go to the Registry of Moneylenders
You can go to the Registry of Moneylenders (RoM) in Singapore when you get threats from the lenders. Moreover, if you see any illegal thing with the lenders, such as a high interest rate, you can ask RoM for help.
If they are found to break the laws, moneylenders will have their licenses revoked.
What Happens If I Cannot Repay My Loan?
Life is unexpected. You might suddenly lose your job or face a financial emergency.
If you are in a bad place and cannot pay any money right now, you should negotiate your repayment terms. Licensed moneylenders are humans after all. Reliable ones like Katong Credit understand our customers and try to help them in ways that we can. Speak to us, we might be able to lend a hand.
Alternatively, here are other things you can try.
- File for Bankruptcy
First of all, when you don’t have a penny, and your debt is at least S$15,000, you can declare bankruptcy. In this way, you can stop any financial institution from taking any further legal actions against you. Moreover, your debt amount won’t be increasing anymore.
- Go for the Debt Repayment Scheme
Borrowers with unsecured debts less than $150,000 can apply for the Debt Repayment Scheme. This scheme helps both debtor and creditor and avoids bankruptcy.
After all the considerations, if you are qualified for it, the Official Assignee (OA) will inspect the situation in and out. Then the OA will set up a Debt Repayment Plan for you, and according to that, you will keep paying the money you owe.
Firstly, you have to repay the money in a fixed amount of time, and it can’t be more than five years. Furthermore, the scheme isn’t free of cost; you have to pay fees to get this done.
But the bright side is, this debt repayment scheme ensures that you complete your loan contract safely. Once you’ve completed the entire process, you will be able to start afresh.
The Bottom Line
Hopefully, you have learned about the things that licensed moneylenders can’t do when collecting debts in Singapore. To be honest, most of the rules and laws are in favor of the debtor. Therefore, if you keep paying your installments regularly, you are less likely to go through any of these problems.
The key is choosing the right licensed moneylender who is willing to go the extra mile for your needs. Katong Credit is one such financial company and we are conveniently located in Lucky Plaza.
Moreover, while borrowing money, you should always take it from a licensed lender. Remember to read their Google Reviews to find out how they are truly like! Otherwise, you will have to go through many ordeals, and your ways of getting help will be limited. Let’s avoid that, shall we?
borrowing moneyborrowing money in Singaporedebt repayment schemehow to avoid bankruptcylicensed moneylender Singaporewhat a moneylender cannot dowhat are legal debt collection methodswhat can licensed moneylenders dowhat cant licensed moneylenders dowhat cant moneylenders do during debt collectionwhat is illegal debt collectionwhat is the debt repayment scheme