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    We found 2 HSBC's Debt Consolidation Plan (DCP)
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    Personal Loan BYTES FROM OUR KITCHEN

    HSBC's Debt Consolidation Plan (DCP)

    HSBC is a leading financial institution enjoying a strong presence not just in Singapore but across the globe as well. The bank offers a range of financial products and solutions including offering customers various types of credit. The Debt Consolidation Plan from HSBC is one such loan product that allows borrowers to consolidate their unsecured credit such as credit card balances, personal loans and personal lines of credit from other banks and financial institutions into one consolidated loan.

    "Apply online for this unsecured loan by 2 March 2018 (and have it approved by 31 March 2018) to enjoy promotional interest rates starting from 4.7% p.a. with an EIR of 8.5% p.a. Also get a waiver on processing fees, which is usually charged at 1% of the approved loan amount, with a minimum fee of S$88. From 3 March to 31 March 2018, get S$100 cashback when you apply for this loan online."

     Let us learn more about the HSBC’s Debt Consolidation Plan.  

    Features and Benefits of HSBC's DCP

    • The HSBC DCP allows borrowers to consolidate their outstanding balances from other existing unsecured personal loans into a single term loan.
    • Borrowers will only have to make one fixed monthly payment at a lower rate of interest instead of several repayments.
    • The plan has a tenure ranging from 1 year to 10 years.
    • The debt consolidation loan amount offered will include an additional 5% allowance to cover miscellaneous charges a borrower might incur.
    • The plan provides borrowers with ease of management as they have to deal with only one financial institution.
    • The plan also instils a sense of financial discipline and provides them with better control of their finances.
    • HSBC offers their DCP along with a revolving credit facility in the form of the HSBC Visa Platinum Credit Card. The credit limit on this card will be 1X the borrower’s monthly income.

    Interest Rate on HSBC's Debt Consolidation Loan 2018

    The HSBC Debt Consolidation Plan offers the following tenures and interest rates:

    Tenure Equivalent Flat Interest Rate Effective Interest Rate
    1 year 7.6% p.a. 15.7% p.a.
    2 years 7.5% p.a. 14.8% p.a.
    3 years 7.6% p.a. 14.5% p.a.
    4 years 7.7% p.a. 14.3% p.a.
    5 years 7.8% p.a. 14.3% p.a.
    6 years 7.9% p.a. 14.2% p.a.
    7 years 8.1% p.a. 14.1% p.a.
    8 years 8.9% p.a. 15.1% p.a.
    9 years 9.1% p.a. 15.1% p.a.
    10 years 9.2% p.a. 15.1% p.a.

    How the HSBC's DCP Works in Singapore

    The HSBC Debt Consolidation Plan consolidates all other existing lines of unsecured credit. Let us assume a borrower has the following lines of credit:

    Type of Credit Outstanding balance Interest rate Monthly payment
    Credit card 1 S$15,000 26% p.a. S$500
    Credit card 2 S$10,000 26% p.a. S$400
    Personal loan S$15,000 14% p.a. S$500

    Now if we assume the borrower has a monthly salary of S$3,000, we can see that the monthly payments of the borrower amounts to S$1,400 which is almost 50% of the monthly salary. If the borrower was to go for an HSBC debt consolidation loan, he/she would receive a loan amount of S$42,000 (5% allowance included). The monthly payment for a tenure of 5 years would amount to S$861.69, giving the borrower savings of S$6,641.23 in interest payments alone.

    Note: The figures have been simplified for an illustrative purpose and actual figures would vary based on the rates given.

    HSBC's Debt Consolidation Plan Eligibility

    • The borrower must be a Singaporean citizen or a Permanent Resident.
    • The annual income of the borrower must be S$30,000 or more.
    • The annual income of the borrower cannot exceed S$119,999.
    • The total interest bearing balance of the borrower's existing unsecured lines of credit must exceed the borrower’s monthly income by at least 12 times the amount.

    Documents Required

    The applicant must provide the following documents at the time of application:

    • A copy of the applicant’s NRIC, both front and back
    • A copy of the applicant’s most recent Credit Bureau Report
    • A copy of the applicant’s latest income documents such as computerised payslip, CPF contributions and Income Tax Notice of Assessment
    • Most recent credit card and unsecured credit loan statements (online or physical copy)
    • A confirmation letter showing the unbilled balances of unsecured credit instalment plans (if applicable)

    How to apply for HSBC's Debt Consolidation Plan

    Borrowers can apply for the HSBC DCP either online by downloading the application form, completing it and uploading it on the HSBC website along with the required supporting documents.

    Alternatively, borrowers can also visit their nearest HSBC branch and apply for the Debt Consolidation Plan in person.

    FAQs

    1. What happens when the debt consolidation loan amount does not cover the entire outstanding balance of unsecured lines of credit?
    2. Whatever balance remains unpaid after the DCP loan amount has been disbursed needs to be cleared off by the borrower with the respective financial institution.

    3. Is the revolving credit line compulsory?
    4. The revolving line of credit comes bundled with the DCP account but the borrower can choose to not use it.

    5. Can the credit limit be increased?
    6. No, the credit limit offered on the revolving line of credit cannot be increased. It is fixed at the borrower’s 1X monthly income. However, if the borrower’s income increases, they can apply for a permanent credit limit increase by submitting revised income documents.

    7. How many Debt Consolidation Plans can one apply for?
    8. A borrower can hold only one DCP at a time regardless of which financial institution they have acquired it from.

    9. Is the amount disbursed to a designated savings or current account?
    10. No. The amount will be used to settle outstanding unsecured balances with respective financial institutions directly and will not be disbursed to the borrower.

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