How to Pick the Best Personal Loan in Singapore
Always consider all of your options before applying for a personal loan. Although personal loans are more affordable than credit card debt, they still come relatively high. Interest rates and other terms can vary a lot depending on your annual income and other factors. Hence, here is some parting tip for those who want to take out a personal loan.
- Total Cost: this is the dollar cost you end up paying in interest & fees. You can reduce it by choosing a low effective interest rate and short duration.
- Monthly Payment: you need to afford the monthly repayment during the loan’s tenure comfortably. Unless you will end up paying significant amounts in penalty fees & interest, to figure out your monthly payment, first multiply your yearly flat rate by the principal amount. Then, multiply this amount by the span of your loan in years. Next, add this amount to the principal you rented. Dividing this by the span of your loan in months will result in the monthly payment (also called monthly repayment or monthly installment) that you need to make to the bank.
- Balance: You must strike a balance between the two. (2) numbers as much as possible. Try to reduce your personal loan’s total cost while ensuring that the monthly payment required to repay the loan is within your financial means
Personal Instalment Loan Comparison Table
Refer to our summary table below for the most suitable personal loan offerings in Singapore.
Personal Loans | Best For… | min. Annual Income |
---|---|---|
HSBC Personal Loan | Best Personal Loan | S$30,000 |
Standard Chartered CashOne | Best Promotions | S$20,000 |
POSB/DBS Personal Loan | Fast Cash Disbursement | S$20,000 |
Citibank Quick Cash | Small, Short Term Loans | S$30,000 |
Citibank Quick Cash 0% Interest | Small, 1-Year Loans | S$30,000 |
OCBC Cash-On-Instalment | Short-Term Alternative | S$30,000 |
Standard Chartered CashOne | Annual Income Below S$30,000 | S$20,000 |
HSBC Personal Loan | Foreigners in Singapore | S$40,000 |
Effective Interest Rate (EIR) vs. Flat Interest Rate
You must be at least 21 to 65 years old to qualify for a personal loan in Singapore. Also, most banks will need a minimum yearly income of S$30,000, though some banks lend to a client with as little as S$20,000 of annual revenue. For foreigners, this limit rises to $40,000-S$60,000 depending on the lender.
To be accepted, you will most likely need to present the following records to the lender:
- Proof of Identity: Passport + Singapore Identification Card (IC) or Employment Pass (EP)
- Proof of Address: Documents containing your home address (i.e., utility bills with your name and address)
- Proof of Income: Your Latest 12 months’ Latest Income Tax Notice of Assessment or Central Provident Fund (CPF) contribution history statement or Salary Crediting or Latest Computerised Payslip into the lender’s bank account
To study more about how special loans work in Singapore, read our guides on the basics of personal loans and how much they cost.
What You Need to Apply for A Personal Loan
To be eligible for a personal loan in Singapore, you must be between 21 and 65 years old. In addition, most banks will require a minimum annual income of S$30,000, though some banks will lend to people with annual incomes as low as S$20,000. This limit rises to $40,000-S$60,000 for foreigners, depending on the lender.
You will almost certainly need to provide the following documents to the lender in order to be approved:
- Proof of Identity: Passport + Singapore Identification Card (IC) or Employment Pass (EP)
- Proof of Address: Documents containing your home address (i.e., utility bills with your name and address)
- Proof of Income: Your Latest 12 months’ Latest Income Tax Notice of Assessment or Central Provident Fund (CPF) contribution history statement or Salary Crediting or Latest Computerised Payslip into the lender’s bank account
To study more about how special loans work in Singapore, read our guides on the basics of personal loans and how much they cost.
Want to learn more about personal loans? Here are some answers to commonly asked questions.
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About FR Capital
FR Capital is a Singapore consultancy firm that helps SMEs to secure business loans from banks and financial institutions. We concentrate on SME finance, and through our expertise and network, we help clients secure funding with low-interest rates efficiently and hassle-free.