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Maids free to borrow from licensed moneylenders without getting permission from employers

This article is more than 12 months old

MOM says they may be driven to borrow from loan sharks if employers' consent is made mandatory

Making it mandatory for foreign domestic workers (FDWs) to seek their employers' consent before they can borrow from licensed moneylenders may drive them to illegal loansharks.

For this reason, the Ministry of Manpower (MOM) does not plan to introduce measures for FDWs or moneylenders to obtain employers' permission before loans can be issued, said its Senior Parliamentary Secretary Low Yen Ling yesterday.

"We are concerned that, if and when we do so, it may well trigger the FDW towards taking more drastic actions such as... borrowing from unlicensed moneylenders," she said. "It's a very delicate balance."

Ms Low was responding to a suggestion made in Parliament by Mr Darryl David (Ang Mo Kio GRC) for employers' consent to be sought before maids can borrow from licensed moneylenders.

He drew a parallel to the self-exclusion framework in which family members can apply to exempt an individual from entering casinos.

Under new rules announced in October, all Singaporeans and foreigners can apply to be self-excluded from borrowing from licensed moneylenders. But there is no provision for third-party application to exclude others without their consent.

The growing number of foreign domestic workers borrowing from licensed moneylenders in recent years has triggered concerns among many, especially employers.

FIGURES

Last year, about 12,000 maids borrowed money from licensed moneylenders, up from 1,500 maids who borrowed in 2016.

Already, 28,000 maids have borrowed money between January and June this year.

Releasing the figures in Parliament in response to questions posted by Mr David and Mr Sitoh Yih Pin (Potong Pasir), Senior Minister of State for Law and Health Edwin Tong said "the large majority of FDWs have repaid their loans from licensed moneylenders".

In a separate reply, Law and Home Affairs Minister K. Shanmugam said the police received about 460 reports of harassment by unlicensed moneylenders that came from FDWs borrowing or acting as guarantors between 2013 and September this year.

The police did not receive similar reports between 2008 to 2012, Mr Shanmugam said, replying to a question from Mr Gan Thiam Poh (Ang Mo Kio GRC) on the number of FDWs borrowing from illegal moneylenders.

Licensed moneylenders are not allowed to harass FDWs who borrowed from them or their employers for repayment, Ms Low added, advising employers who had been harassed to go to the police.

She said the MOM will repatriate work pass holders who had borrowed money from unlicensed moneylenders and debar them from working in Singapore.

Employment