Have you run up a considerable amount of debt on your cards? Are you planning to renovate your house? Do you need money to clear unpaid medical bills? The Standard Chartered Bank (SCB) CashOne Personal Loan lends cash at competitive rates and you even get a complimentary credit card to help manage your daily expenses. To top it all, if you apply now, you’ll also get cashback as a welcome gift.
Apply for a CashOne Loan before 31 March 2019 and get cashback of up to S$1,088 upon approval of your loan. The cashback you earn is a percentage of the loan amount disbursed. Additionally, you receive a cashback credit of S$199 (which is the annual fee for the first year) and if you apply online you also get S$50 cashback. Here’s how the cashback amount will be decided:
|Loan Amount||Cashback on Approved Loan Amount||First Year Annual Fee Credit||Online Application Cashback||Total Cashback|
|S$150,000||(0.8%) S$1,088 since cashback is capped at this amount||S$1,337|
The bank offers offer low interest rates on this personal loan. Depending on the loan tenure and the amount approved, the interest rates are as follows:
|Type of Interest||Lowest Rate||Highest Rate|
|Applied or flat interest rate(AIR)||6.88% p.a.||10.8% p.a.|
|Effective interest rate (EIR)||12.75% p.a.||27.56% p.a.|
Let Us Illustrate:
Let us assume that you have been granted a loan of S$4,000. For the sake of simplification, let us assume that the annual fee of S$199 was charged on your loan account (disregarding the fact that you’ll receive a cash credit later to offset this fee charged upfront) and consider it as a component in the effective interest rate applicable.
The following table shows the flat rate and EIR on the approved loan amount for loan tenures of 1 year, 2 years, and 3 years if your annual income is between S$20,000 to S$29,999:
|Loan Tenure||Flat Rate||EIR|
|1 year||9.8% p.a.||27.56% p.a.|
|2 years||9.8% p.a.||23.14% p.a.|
|3 years||10.8% p.a.||22.99% p.a.|
If your annual income is S$30,000 and above, and you decide to apply for a loan of S%10,000. These are the interest rates for 1 year, 2 years, and 3 years:
|Loan Tenure||Flat Rate||EIR|
|1 year||8.58% p.a.||19.34% p.a.|
|2 years||8.58% p.a.||17.76% p.a.|
|3 years||8.38% p.a.||16.63% p.a.|
[Disclaimer: The numbers used in the table are for illustrative purposes alone. The actual values and results may vary. Check with the bank for the latest rates before you apply.]
The fees that you pay along with the interest charges also go some way in determining the affordability of your loan. Hence, lower the fees, higher could be your savings. The following fees will apply on your borrowing:
|Annual fee||S$199 for the first year S$50 from the second year until the expiry of the loan|
|Early repayment charge||3% of the outstanding balance, subject to a minimum of S$150|
|Loan restructuring fee (for changing the initial tenure)||S$50 for each change|
|Default interest rate||4% p.a. will be added to the original EIR|
|EIR on balance carried forward||26.9% p.a. or 0.074% per day|
|Late payment fee||S$80|
|Annual fee on the SCB card||S$192.60 (Waived for the first 5 years)|
Q. How does the bank calculate the interest on my loan?
A. The bank uses the front-end, add-on method to compute the interest chargeable on your outstanding dues. Under this method, the approved loan amount is multiplied by the flat interest rate for the full tenure of the loan.
Q. Is partial repayment of my CashOne Loan possible?
A. The bank doesn’t allow partial repayments. For premature account cancellation or early redemption, certain fees may be added to the outstanding principal and interest charges.
Q. What is default interest?
A. If you fail to pay the monthly instalment at least twice within a six-month period, an additional interest rate of 4% p.a. will be added to your existing EIR. This rate is called the revised interest rate and it will become effective from the next statement cycle.
Q. Once the default interest rate becomes effective, will it apply for the remainder of the loan tenure?
A. From the time the revised interest rate comes into effect, if you make full payments on the outstanding loan within the due date for 6 consecutive months, the bank may revoke the revised rate and reinstate the original EIR.
Q. How is the monthly instalment calculated?
A. The monthly instalment (MI) is calculated thus:
MI = (A+B)/C, where A = the loan amount, B = the interest applicable over the full tenure, C = the number of months in the loan tenure.