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  • Personal Loan BYTES FROM OUR KITCHEN

    Personal Loan Eligibility

    Personal loans can help you in achieving your financial goals and can also assist you in taking care of such financial needs that emerge due to an uncertain or unfortunate events in life. The money that you earn every month or the amount that you save may not be enough to help you with your expenses. You might also find it uncomfortable to borrow money from your friends or family members and so the best alternative will be to apply for a loan from a bank and easily get access to the required money. In Singapore, there are many banks, financial institutions and money lenders that offer different types of personal loan products.

    Personal Loan Eligibility Criteria

    When you apply for a personal loan, you will need to meet the eligibility criteria that are laid down by the bank or financial institution. However, the eligibility criteria will not be the same for all banks. Here are some of the usual eligibility criteria that you will need to meet when you apply for a personal loan in Singapore:

    • Age of the applicant – when you apply for the loan, you should be minimum 21 years of age. There are some banks that might offer loans to people aged 18 and above but most banks do not accept applicants below 21 years and above 60 years.
    • Annual Income – Most banks in Singapore will require you to have a minimum annual income of S$20,000 or more if you are a Citizen or a Permanent Resident of Singapore, and S$45,000 or more if you are a foreigner working in Singapore with valid work permits.
    • Residency status – Most banks and financial institutions in Singapore also offer personal loans to foreigners working in Singapore, along with Singaporeans and Permanent Residents of Singapore. However, there are a few moneylenders and financial institutions that only offer personal loans to Singaporeans and Permanent Residents of Singapore.
    • Relationship with the bank – Some banks are more likely to offer personal loans to those applicants who already have savings accounts, credit cards or other products with the bank. The banks can rely on such customers and so they are more likely to offer personal loans to them.
    • Employment status – Apart from salaried professionals, self-employed individuals, contract workers, temporary workers and businessmen can also apply for a loan and get the financial assistance they require.

    Personal Loan Eligibility According to Banks

    Bank of China Personal Loans – You will most likely be eligible for a personal loan from Bank of China if you are:

    • In the age group of 21 – 65 years
    • A salaried or self-employed individual with regular income

    HSBC Bank Personal Loans - The eligibility criteria for the personal loan products offered by HSBC Bank in Singapore are listed below:

    • You must minimum 21 years old but not older than 65 years.
    • You should have an annual income of minimum S$30,000 if you are a Citizen or a Permanent Resident of Singapore who is a working professional.
    • You should have an annual income of minimum S$40,000 if you are a Citizen or a Permanent Resident of Singapore who is a commission-based employee or is working on a freelance basis.
    • You should have an annual income of minimum S$40,000 if you are a foreigner with employment pass that is valid for a minimum period of 1 year.

    Citibank Personal Loan - The following are the eligibility criteria for Citibank personal loan products:

    • If you have a minimum annual income of more than S$30,000, you can directly apply for the loan. If you are an individual with an annual income ranging from S$20,000 - S$30,000, you will need to apply through the Citibank Ready Credit SmartCash scheme.
    • You should be aged 21 and above.
    • If you are a foreigner, your minimum annual income should be S$42,000.

    CIMB Personal Loan – The eligibility criteria is different for different personal loan products offered by CIMB in Singapore. Education loan and renovation loan are available to only Singaporeans and Permanent Residents of Singapore but portfolio financing is available to foreigners as well.

    POSB Bank Personal Loan – Given below are the eligibility criteria for POSB Bank Personal Loan:

    • You should be in the age group of 21 years to 65 years
    • You should have a minimum annual income of S$20,000 or more (for Singaporeans and Permanent Residents) and S$45,000 or more (for foreigners)
    • The maximum amount offered as a loan is S$200,000 for Singaporeans and Permanent Residents is and S$60,000 for foreigners.

    Standard Chartered Bank Personal Loan – In order to apply for a personal loan with Standard Chartered Bank, you need to fulfil the following eligibility criteria:

    • You should be aged 21 and above but not more than 65 years of age.
    • You should be a Singaporean or a permanent resident of the island with an annual income of earning S$20,000.
    • You should be a foreigner with an annual income of S$60,000 and with a valid employment pass.
    • Your employment pass should either be type P1, P2, or Q.
    • If you have a Q pass, it should have a validity of minimum 1 year.

    DBS Bank Personal Loan - The eligibility criteria for personal loans from DBS Bank are given below.

    • You should be aged 21 and above but below 65 years of age.
    • You should be a Singaporean or a permanent resident of the island with an annual income of earning S$20,000.

    ICBC Personal Loan – You have to fulfil the following criteria when applying for a personal loan with ICBC:

    • You should be aged 18 and above.
    • You should have a current account with the bank.

    UOB Bank Personal Loan – Here are the eligibility criteria for UOB Personal Loan:

    • You need to have a CashPlus account to apply for an UOB CashPlus Personal Loan.
    • You should be in the age group of 21 – 60 years.
    • You should have a minimum annual income of S$30,000.

    OCBC Bank Personal Loan – The eligibility criteria for OCBC Bank Personal Loan are as follows:

    • You should be aged 21 and above.
    • You should have a minimum annual income of S$20,000 (for citizens of Singapore) and S$30,000 (for permanent residents and foreigners).

    Maybank Personal Loan – As Maybank does not have a personal loan, the personal line of credit from Maybank has different eligibility criteria and you can contact the bank to know about the same.

    Factors affecting Personal Loan Eligibility

    There are several factors that affect the eligibility for personal loans and some of these factors are given below:

    • Annual income – As you can see from the information given above, your annual income will play a very important role in deciding whether you will be eligible for a personal loan from a particular bank or not.
    • Age – You will need to be an adult aged 21 and above to apply for a personal loan. If you are a minor, you can take financial assistance from your legal guardians.
    • Work permit – Foreigners working in Singapore need to have valid work permit with a validity period of minimum 1 year. Foreign contract workers who reside in the Lion City for short time are not eligible for personal loans.

    How to increase personal loan eligibility in Singapore?

    Apart from the eligibility criteria, you also need to have a good credit score if you want to increase your personal loan eligibility. Besides, you need to have a steady income so that the banks will consider you dependable and will be more likely to offer you with a loan. Also, make sure that you do not have any unpaid debts as it might lower your chances of getting a personal loan.

    FAQ's

    Q. What factors do banks consider before approving my personal loan application?

    A. Banks can approve or reject your loan application based on many factors. However, the key factors include:

    • Age
    • Annual income
    • Possession of relevant documents
    • Credit score

    To know more about how to choose a right personal loan, click here.

    Q. Who is eligible to apply for a term loan in Singapore?

    A. A personal loan applicant in Singapore needs to be at least 21 years old. Also, he or she can either be a Singapore citizen, Permanent Resident, or a foreigner. The eligibility criterion will vary depending on whether the loan applicant is salaried or self-employed.

    To read more about FAQs regarding how to apply for a personal loan, click here.

    Q. What is the minimum and maximum term loan amount I can apply for?

    A. The minimum and maximum loan amount you can apply for depends on the bank you choose. Take a look at few examples given below for a better understanding:

    • UOB CashPlus Personal Loan: The minimum loan amount you can apply for is S$1,000. The maximum loan amount (this includes processing fee when applicable) you can apply for is up to 98% of the existing credit limit on your UOB CashPlus account.
    • DBS Personal Loan: You can apply for a loan amount that is 4 times your monthly salary. If you have an annual income of S$120,000 and more, you can apply for a loan amount that is 10 times your monthly income.
    • HSBC's Personal Loan: The maximum loan limit depends on your annual income and residential status. If you are a Singaporean or a Permanent Resident and earn a minimum of S$30,000 annually but it doesn’t exceed S$120,000, you will be eligible for a loan amount up to 4 times your monthly income. However, in case you are getting a minimum of S$120,000 annually, you will get up to 8 times your monthly income. If you are a foreigner, the maximum loan amount you can apply will be 4 times your monthly income.

    Q. Will the annual income requirement vary depending on my residential status?

    A. Yes, most banks have a separate income criterion for Singaporeans/Permanent Residents and for foreigners. Usually, the income requirement for foreigners is a bit higher in comparison to Permanent Residents and Singaporeans.

    Q. What is the income criteria for Singaporeans and Permanent Residents to apply for a term loan?

    A. The minimum income requirement for applying for a term loan is S$30,000 p.a. However, the minimum income requirement might vary depending on the bank you choose for your personal loan. This income criterion is applicable for salaried, commission-based, and self-employed Singaporeans and Permanent Residents.

    Q. Will I be eligible to apply for a personal loan in Singapore if I am a foreigner?

    A. Yes, you can apply for it even if you are a foreigner provided you carry an employment pass with a validity of at least one year and you meet the annual income criterion.

    Q. What is the minimum income requirement for foreigners?

    A. Foreigners staying and working in Singapore should have a minimum income of S$40,000 p.a. in order to be eligible to apply for a personal loan. However, the income criterion varies from bank to bank.

    Q. Why should I avoid having a bad credit score when I am considering a term loan?

    A. Banks usually avoid giving term loans to people with a bad credit score. They consider a bad or poor credit score as a sign of your inability to repay your loan amount on time. You should always maintain a good credit history in order to get your term loan approved.

    Q. I have a poor credit score. Will I still be eligible to apply for a personal loan?

    A. Yes, as long as you have all the relevant documents, and you qualify in terms of age and income, you could still apply for a personal loan. However, it is up to the bank authorities to approve or disapprove your personal loan application. If the loan amount you have requested for is huge, the chances of your loan application getting approved are lower due to your poor credit score.

    Q. What can I do to get a term loan when I have a bad credit score?

    A. When you have a bad credit score, it's better to apply for a smaller loan amount, so you can make your loan payments on time. This would also, in turn, help you in improving your credit score. Most of the times, you have a bad credit score because of outstanding debts. In such cases, you must strive hard to restructure all your existing debts. You could also consider using a debt consolidation plan through balance transfer schemes.

    Q. Do I need to submit any collateral for getting a personal loan in Singapore?

    A. No, personal loans in Singapore don’t require any collateral. These loans fall under the category of unsecured loans. Hence, banks tend to assign a higher rate of interest on personal loans so that you’re more careful while servicing your loan repayments.

    Q. How to check if my loan application has been approved?

    A. Let’s assume you have applied for an HSBC personal loan online. Once you have submitted your online loan application, you will get an email notifying you regarding the status of your application after a preliminary review. In case your application is approved, you will be asked to provide mandatory documents to process your loan application. The documents required by the bank will be mentioned in the email sent to you.

    Once your documentation is successfully completed, HSBC will give a final approval for your application. HSBC will then disburse your loan amount into a repayment account with HSBC. Also, you will receive a detailed notification letter with your loan features such as your loan tenor, the rate of interest, loan amount, repayment account number, and instalment amount on a monthly basis.

    In case you are a foreigner, once your loan is successfully approved, an officer from HSBC Bank will get in touch with you. You will be invited to a bank branch of your choice in order to get your signature on the facility offer letter.

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