Snippets: NEW CAP FOR LOANS
Borrowers will have their loans capped at an amount that applies across all licensed moneylenders, under proposed changes to the Moneylenders Act.
Currently, there is a cap on loans made with individual moneylenders, but borrowers can still approach other registered moneylenders.
To prevent people from borrowing beyond their means, an aggregate loan cap has been proposed under the Moneylenders (Amendment) Bill tabled by the Law Ministry in Parliament yesterday. Under this cap, those with annual income of less than $20,000 may borrow up to $3,000 from all moneylenders combined.
Other individuals may borrow up to six times their monthly income from all moneylenders combined.
Moneylenders cannot provide loans beyond the cap, and must obtain credit reports from the Moneylenders Credit Bureau (MLCB) to check if a borrower has exceeded the limit before issuing a loan.