Based on a study conducted by BBC, Singapore has been termed as a ‘utopia’ by expats living in this city-state due to its employment opportunities and work-life balance. However, it has also been termed as one of the most expensive cities to settle in. As a foreigner in Singapore, you may come across situations when you will need cash urgently to meet an unforeseen expense. That’s where personal loans come in handy. In Singapore, you can get a personal loan for a tenure of up to 7 years at an interest rate of around 8% p.a., depending on your income level.
Imagine you are studying in a university in Singapore and you need immediate cash to buy a laptop for your chosen course. What do you do? You can go ahead and take a personal loan to buy it. The need for extra credit can arise within the first few months of moving to Singapore. You might need a personal loan to pay for your security deposit for the rented apartment or to renovate your new apartment. A personal loan can also come handy to cover your relocation and medical expenses, repair your car or send cash home. In case you want to permanently settle in the country, you can use this loan amount to pay for the application process to become a Permanent Resident.
As a student, you can opt for a personal loan to fund your education. You will probably end up paying 50% more in tuition than a local student for the same course. The amount you withdraw can cover your stay at the college hostel and purchase of new books and accessories.
Most banks in Singapore approve loans to expats if they have a work permit but, impose a high minimum income requirement. For instance, some banks would require you to have an annual income of at least S$40,000 and hold an employment pass with a minimum of one year validity.
If you do not meet the eligibility criteria, then you can look for alternative sources to fund your short-term needs like a licensed moneylender. Moneylenders are known for processing and approving the loan applications faster. In terms of interest rates, licensed moneylenders charge a higher rate compared to banks. However, this interest rate is capped at 4% per month.
If you want to take a personal loan from a bank, you must keep certain things in mind:
Here are some personal loan options for foreigners in Singapore: