Best Personal Loans for Individuals with Bad Credit in Singapore 2024
Personal loans can be a great way to obtain funds quickly; however, it can be hard to find a good loan if you have bad credit. Our loan experts reviewed hundreds of loans from Singapore's top lenders to allow you to compare personal loans with competitive interest rates, low income requirements and flexible features.
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Our Picks for the Best Personal Loans in Singapore
It is difficult to determine which loans are offered to borrowers with low credit scores, as lenders are not very transparent about how they make loan application decisions. However, we believe that our recommendations below give borrowers with bad credit a great place to start their loan application process, as these loans are some of the cheapest options available in Singapore. Additionally, we've highlighted the minimum income requirement of each loan in order to help low-income loan applicants determine which banks best fit their needs. In order to determine the total cost of each loan, we considered interest rates and various fees. In addition to looking for a loan with the lowest total cost of borrowing, borrowers should also try to find a loan with a monthly payment schedule that they will be able to keep up with in order to rebuild their credit.
Best Personal Loan: HSBC Personal Loan
- Eligibility
- S$30,000 of annual income
- Max. Loan Amount
- 4x monthly salary for income S$30,000 to S$120,000; 8x monthly salary for income > S$120,000; S$200,000 Maximum Loan Size (2x monthly salary for foreigners)
- Min. Loan Amount
- S$10,000
- Processing Fee
- S$0
- Approval Time
- 1 minute approval, receive cash in one business day
HSBC's personal loan is the most affordable option for most prospective loan applicants, due to its market leading interest rates (from 6%). HSBC's personal loan is also unique because it is the only loan with tenures of up to 7 years, while other banks tend to only offer loans of 5 years or less. This helps borrowers by spreading the financial burden of a large loan and allowing for smaller monthly payments.
Summary of HSBC's Personal Loan's Interest Rates and Features
| Loan Duration | Flat Rate | Processing Fee | EIR | Monthly Instalment | Total Cost |
|---|---|---|---|---|---|
| 1 year | 3.2% | 1% | 6% | S$860.00 | S$420 |
| 2 years | 3.2% | 1% | 6% | S$443.33 | S$740 |
| 3 years | 3.2% | 1% | 6% | S$304.44 | S$1,060 |
| 4 years | 3.2% | 1% | 6% | S$235.00 | S$1,380 |
| 5 years | 3.2% | 1% | 6% | S$193.33 | S$1,700 |
| 6 years | 3.2% | 1% | 6% | S$165.56 | S$2,020 |
| 7 years | 3.2% | 1% | 6% | S$145.71 | S$2,340 |
| *Assuming S$10,000 loan and income of S$30,000 (Note that rates above are not indicative of your customised loan offer) | |||||
Cheapest Personal Loans from Moneylenders: Lendela Personal Loans
- Eligibility
- S$1,200 per month
- Max. Loan Amount
- 6x monthly salary
- Min. Loan Amount
- S$1,000
- Processing Fee
- Varies
- Approval Time
- 1 day
Because many individuals with weak credit or relatively low incomes are unable to secure personal loans from banks, they often turn to moneylenders. These lenders don't always charge affordable interest rates. Therefore, Lendela is an excellent tool for these individuals. Lendela's platform gives prospective borrowers a comparison of the best personal loans rates from moneylenders. Furthermore, Lendela has a low minimum income requirement (S$1,200 per month) and typically approves applicants for more than 1 same-day loan offer.
| Loan Details | |
|---|---|
| Monthly Interest Rates | from 0.8% (lower rates for returning borrowers) |
| Lendela Application | Free |
| Processing Fees | Vary by lender |
| Loan Size | S$500 to S$100,000 (or 6x monthly income) |
| Loan Disbursement | Within 1 day |
Fastest Cash Disbursement: POSB/DBS Personal Loan
- Eligibility
- S$20,000 of annual income
- Max. Loan Amount
- 4x monthly salary; 10x monthly salary for income > S$120,000
- Min. Loan Amount
- S$500
- Processing Fee
- 1% of loan principal
- Approval Time
- Immediate approval & disbursement for DBS & POSB credit card or line of credit customers
Many borrowers choose to apply for a personal loan because they urgently need the funds, especially those with bad credit. For these individuals, we recommend personal loans from POSB and DBS as these banks offer instant cash disbursement. Furthermore, POSB and DBS provide loans instantly to their credit card and personal line of credit customers.
On top of their attractive promotion and incredibly quick cash disbursement, DBS and POSB stand out due to their personal loans' flat interest rates, which are among the cheapest available in Singapore, starting at 2.88% (EIR 5.79%). However, it is worth noting that rates are significantly higher (11% flat rate, 20.01% EIR) for individuals that earn less than S$30,000 annually.
Summary of POSB/DBS's Personal Loans' Interest Rates & Features
| Loan Duration | Flat Rate | Fee | Effective Interest Rate | Monthly Payment | Total Cost |
|---|---|---|---|---|---|
| 1 year | 2.88% | 1% | 5.79% | S$857.33 | S$388 |
| 2 years | 2.88% | 1% | 5.79% | S$440.67 | S$676 |
| 3 years | 2.88% | 1% | 5.79% | S$301.77 | S$964 |
| 4 years | 2.88% | 1% | 5.79% | S$232.33 | S$1,162 |
| 5 years | 2.88% | 1% | 5.79% | S$190.67 | S$1,540 |
| *Assuming loan of S$10,000 | |||||
Best Personal Loan for Low Income Borrowers: Standard Chartered CashOne
- Eligibility
- S$30,000 of annual income
- Max. Loan Amount
- 2x monthly salary for annual income below S$30,000; 4x monthly salary for annual income > S$30,000; 8x monthly income for annual income above S$120,000 (up to S$250,000)
- Min. Loan Amount
- S$1,000
- Processing Fee
- S$199 for 1st year, S$50 for subsequent years (waived for borrowers who make repayments on time)
- Approval Time
- 15 minutes
Individuals with bad credit and low-income should consider Standard Chartered's CashOne loan. The bank charges interest rates of 9.8% to 10.8% and no processing fee for personal loans to borrowers that earn S$20,000 to S$30,000 per year. These rates are much lower than competitors that charge flat rates of 11% to 13% plus processing fees of up to 4%.
While these rates are clearly attractive to individuals with lower incomes, it is important to note that Standard Chartered only offers these borrowers loans of up to S$5,000 or 2x their monthly salary, whichever is lower. This can be limiting if you are seeking a loan in order to pay for a very large expense such as a wedding. However, if you make less than S$30,000, we strongly recommend against borrowing more than this amount in the first place.
Summary of Standard Chartered CashOne's Interest Rates and Features
| Loan Duration | Flat Rate | Fee | Effective Interest Rate | Monthly Instalment | Total Cost |
|---|---|---|---|---|---|
| 1 year | 9.8% | S$0 | 27.56% | S$274.50 | S$282 |
| 2 years | 9.8% | S$0 | 23.14% | S$149.50 | S$576 |
| 3 years | 10.8% | S$0 | 22.99% | S$110.33 | S$960 |
| 4 years | 10.8% | S$0 | 21.80% | S$89.50 | S$1,284 |
| 5 years | 10.8% | S$0 | 20.92% | S$77.00 | S$1,608 |
| Promotion: Up to S$1,288 cashback | |||||
| *Assuming existing customer with annual income of S$20,000, S$3,000 loan | |||||
Best Small, Short-Term Personal Loan: Citibank Quick Cash Personal Loan
- Eligibility
- S$30,000 of annual income
- Max. Loan Amount
- 4x Monthly Income (or S$150,000)
- Min. Loan Amount
- S$1,000
- Processing Fee
- 0%
- Approval Time
- 1 hour (before 5pm)
Individuals that do not have excellent credit scores, but want seek an affordable short-term loan, should consider Citibank Quick Cash Personal Loan (formerly known as Ready Credit PayLite). While it is unclear what Citi's credit requirements are for this product, they do offer very competitive rates for new customers. For example, for loan tenures of 1 to 3 years, Citibank's effective interest rate is 7.5% - 8.5%, which among the lowest rates available in Singapore. Additionally, Citibank does not charge a processing fee and its minimum loan amount is only S$1,000 compared to HSBC’s S$5,000, making it very accessible for all borrowers.
However, there are some drawbacks to Citibank's Personal Loan. First, the bank does not charge the lowest interest rates for longer-term personal loans. For instance, loans with tenures of more than 3 years come with effective rates of up to 10.5%, which is much higher than the rates offered by it top competitors. This makes Citibank's Personal Loan a less attractive option for borrowers that require long-term financing. Also, while Citibank makes loan application decisions within an hour, cash is disbursed within 3 to 5 days, which is slower than other personal loans in Singapore.
Summary of Citibank's Personal Loan's Interest Rates and Features
| Loan Tenure | Flat Rate | Fee | EIR | Monthly Instalment | Total Cost |
|---|---|---|---|---|---|
| 1 year | 4.94% | 0% | 9.0% | S$874.50 | S$494 |
| 2 years | 4.92% | 0% | 9.0% | S$457.67 | S$984 |
| 3 years | 4.55% | 0% | 8.5% | S$315.69 | S$1,365 |
| 4 years | 5.72% | 0% | 10.5% | S$256.00 | S$2,288 |
| 5 years | 5.79% | 0% | 10.5% | S$214.92 | S$2,895 |
| *Assuming loan of S$10,000, total cost includes impact of promotions | |||||
Best Personal Loan for Foreigners in Singapore
- Eligibility
- S$30,000 of annual income
- Max. Loan Amount
- 4x monthly salary for income S$30,000 to S$120,000; 8x monthly salary for income > S$120,000; S$200,000 Maximum Loan Size (2x monthly salary for foreigners)
- Min. Loan Amount
- S$10,000
- Processing Fee
- S$0
- Approval Time
- 1 minute approval, receive cash in one business day
If you are a foreigner living in Singapore and you need a personal loan, we strongly recommend that you consider applying for HSBC's personal loan. HSBC charges some of the lowest interest rates on the market and has the lowest income requirement for foreigners at S$40,000. HSBC also offers the longest personal loan tenures (7 years) of any bank in Singapore. This allows borrowers to spread out their cost and minimise their monthly payment. It also allows borrowers to improve their credit over time. On top of that, HSBC is currently waiving its processing fee (S$88) and offering S$100 cashback to individuals that apply online.
Best Debt Consolidation Loan Plans in Singapore
Debt consolidation plans are loans that are designed to help borrowers repay existing debts by charging lower interest rates than the borrowers' existing loans. These plans can serve as cheaper alternatives to personal loans for borrowers that require financing to repay other, more expensive debt.
HSBC Debt Consolidation Loan Plan
- Balance to Income Ratio
- More than 12x monthly income
- Early Repayment Fee
- 5% of redemption amount
- Late Payment Fee
- S$75
- Processing Fee
- 1% of approved loan amount, subject to a minimum of S$88
Debt consolidation loans can be a helpful way for borrowers with a lot of debt and bad credit scores to repay their existing loans and begin to repair their credit history. We recommend that borrowers consider HSBC's debt consolidation loan because it offers the lowest guaranteed interest rate, while also waiving its processing fee. For example, the bank charges a flat interest rate of 4% for loans of 1 to 7 years, compared to its competitors that generally charge 5% - 6%. It also charges the lowest rates for longer term debt consolidation loans with interest rates of 5.7% for loans of 8 to 10 years, while other banks charge at least 6%. It is also worth noting that the bank is offering S$100 to online applicants.
Details of HSBC Debt Consolidation Loan
| HSBC Debt Consolidation Loan | Details |
|---|---|
| Processing Fee | S$88 or 1%, waived |
| Flat Interest Rate 1-7 Years | 4.0% |
| Flat Interest Rate 8-10 Years | 5.7% |
| Promotion | S$100 cashback for online application + Processing fee waiver |
Best Balance Transfer Loans in Singapore
Balance transfer loans provide borrowers with the opportunity to consolidate their existing debt and transfer the balance to one new loan. These loan products tend to offer 3 to 12 months with no interest. This is helpful for borrowers that want to repay their debt quickly. Most banks offer a balance with a 6-month interest-free period, so we focused on these offerings in this section. For more information regarding the best 3 and 12-month interest free balance transfers, please refer to our guide of the best balance transfers in Singapore.
Best Credit Card Balance Transfer Loan: Standard Chartered Funds Transfer
- Processing Fee
- 1.5%
- Maximum Principal
- 95% of credit line
- Interest Free Period
- 6 months
Standard Chartered's Funds Transfer is a great balance transfer for repaying credit card debt.This loan combines a low processing fee (1.99%) with the lowest minimum payment requirement (1%) available in Singapore. Additionally, the bank gives borrowers flexibility by offering interest-free periods of 6 and 12 months, both with total costs well below the average in Singapore.
With any balance transfer, it is important to repay the loan before the end of the interest free period. This is because following the interest-free period banks charge very high interest rates. For example, Standard Chartered charges 25.9% annually. However, it is important to note , Standard Chartered's balance transfers accrue interest of 25.9% annually. This highlights the necessity of making monthly payments that exceed the minimum monthly repayment requirement in order to avoid accruing a substantial interest costs.
Summary of Standard Chartered's Balance Transfer Costs
| Interest-Free Period | Processing Fee | Effective Interest Rate | Prevailing Interest Rate |
|---|---|---|---|
| 6 months | 1.99% | 4.12% | 25.9% |
| 12 months | 4.99% | 4.86% | 25.9% |
Best for Large Balances: Maybank Fund Transfer
- Processing Fee
- 1.38%
- Maximum Principal
- 95% of credit line
- Interest Free Period
- 6 months
If you have at least S$10,000 in debt that you expect to be able to repay easily within 6-months, Maybank's balance transfer could be a good fit for you. The bank charges a processing fee of 1.38%, which is tied for the lowest in Singapore, and the bank advertises a lower EIR than any other bank for balance transfers of at least S$10,000 with 6 months interest-free. However, it is crucial for borrowers to repay this large balance transfer within 6 months, as Maybank charges an interest rate of 25.9% annually following the interest-free period.
Summary of Maybank's Balance Transfer Costs
| Duration | Minimum Transfer | Interest Rate | Processing Fee | Effective Interest Rate | Prevailing Interest Rate |
|---|---|---|---|---|---|
| 6 months | S$10,000 | N/A | 1.38% | 2.96% | 25.9% |
| 6 months | S$2,000 | N/A | 1.88% | 4.02% | 25.9% |
| 12 months | S$2,000 | 4.99% | 2.5% | 9.01% | 25.9% |
Compare the Best Personal Loans
For a quick summary of this article, please refer to our summary table below for the best personal loan offerings in Singapore.
| Personal Loans | Best For... | Min. Annual Income | |
|---|---|---|---|
| HSBC Personal Loan | Best Personal Loan | S$30,000 | |
| POSB/DBS Personal Loan | Instant Cash Disbursement | S$20,000 | |
| Citibank Personal Loan | Small, Short Term Loans | S$30,000 | |
| OCBC Cash-On-Instalment | Short-Term Alternative | S$30,000 | |
| Standard Chartered CashOne | Annual Income Below S$30,000 | S$20,000 | |
| HSBC Personal Loan | Foreigners in Singapore | S$40,000 |
| Personal Loans | Best For... | Min. Annual Income | |
|---|---|---|---|
| HSBC Personal Loan | Best Personal Loan | S$30,000 | |
| POSB/DBS Personal Loan | Instant Cash Disbursement | S$20,000 | |
| Citibank Personal Loan | Small, Short Term Loans | S$30,000 | |
| OCBC Cash-On-Instalment | Short-Term Alternative | S$20,000 | |
| Standard Chartered CashOne | Annual Income Below S$30,000 | S$20,000 | |
| HSBC Personal Loan | Foreigners in Singapore | S$40,000 |
How to Compare Personal Loans
We strongly recommend that before applying for any financial product, borrowers consider if the product is the best option for their circumstances. While personal loan debt tends to be less expensive than other loans, such as credit card debt, it can still cost thousands of dollars and should not be taken lightly, especially by individuals with less than optimal credit histories. Therefore, it is crucial to compare interest rates and other loan features before diving into the loan application process.
- Total Cost: this is the dollar amount you end up paying in interest and fees. You can minimize it by choosing low effective interest rate and short duration.
- Monthly Payment: you should be able to comfortably afford the monthly payment during the loan’s tenure. Otherwise, you will end up paying significant amounts in penalty fees and interest. To figure out your monthly payment, first multiply your annual flat rate by the principal amount. Then, multiply this amount by the duration of your loan in years. Then add this amount to the principal you borrowed. Dividing this by the duration of your loan in months will result in the monthly payment (also called monthly instalment) that you need to make to the bank.
- Balance: you need to find a balance between the two factors above. Try to minimize the total cost of your personal loan, while making sure that your finances can comfortably handle the monthly installment required to pay off the loan.
Effective Interest Rate (EIR) vs Flat Interest Rate
It’s very important to consider the flat rate and effective interest rate (EIR) when comparing personal loans. The flat rate is the number you use to calculate how much interest you owe on the loan. For instance, if you take out a S$10,000 loan with a 5% flat interest rate and a 5-year tenure, you will be required to pay S$500 in interest per year for the next 5 years.
EIR on the other hand, represents the true economic cost of the loan and accounts for processing fees and your loan repayment schedule. Another important difference between the 2 types of interest rates is that because borrowers don’t get to use the full amount of the loan during its duration, they end up facing a higher cost than just the flat rate. Phrased differently, you are paying some money back every month but that has no impact on reducing your interest payment.
This highlights the importance of examining both numbers when comparing personal loans. On one hand, flat interest rates will determine how much you have to pay back to the bank on a monthly basis. On the other hand, EIR will tell you what the loan is really costing you economically. For example, you may be misled if you believe that a personal loan is only going to cost you 4% to 8% by looking at its flat rate. In reality, it is really costing you 12% to 20%, if not more, which is represented by EIR.
What You Need to Apply for A Personal Loan
In Singapore, you need to be between 21 and 65 years old to qualify for a personal loan. Also, banks require a minimum annual income of S$20,000 to S$30,000. For foreigners, this limit increases to $40,000 to S$60,000 depending on the bank. To prove that you meet the bank's requirement, you will typically be required to provide documents proving your identity, address and income. These generally include:
- Proof of Identity: Singapore Identification Card (IC) or Employment Pass (EP) + Passport
- Proof of Address: Documents including your residential address (i.e. utility bills with your name and address)
- Proof of Income: Your Latest 12 months’ Central Provident Fund (CPF) contribution history statement or Latest Income Tax Notice of Assessment or Latest Computerised Payslip or Salary Crediting into the lender’s bank account
To learn more about how personal loans work, please refer to our guide about personal loan basics and average personal loan interest rate guide.
Types of Personal Loans Available in Singapore
Borrowers in Singapore are able to choose between a few types of personal loans. Personal instalment loans are the most common type. These loans provide a lump some of money up front, which borrowers the repay in monthly instalments throughout the loan tenure. These loans are typically best used for large one-off expenses, such as weddings or medical procedures. In addition to personal instalment loans, personal lines of credit are another popular loan type in Singapore. These credit lines allow to "draw" funds as needed up to a limit determined by the bank. They are also different from personal instalment loans because they only charged interest based on the amount of money they have borrowed. This can make this type of financing cheaper depending on your borrowing needs, and is worth considering for borrowers that are working to improve their credit score. Credit lines are also particularly useful for individuals that plan to borrow smaller amounts on an ongoing basis.
For borrowers that already have a significant amount of personal debt, balance transfer loans and debt consolidation loans offer an opportunity to consolidate and repay existing loans. Balance transfer loans allow borrowers to transfer outstanding loan balances to a one new loan. Additionally, many banks offer an interest-free period of 3 to 12 months, during which borrowers are not required to make interest payments. This makes these loans a great option for consolidating and paying down your personal debt quickly. On the other hand, Debt consolidation loans are similar in that they allow borrowers to pay down various personal debts; however, they are instalment loans that provide a lump sum of cash in order to pay down various debts. Debt consolidation loans are typically best used for repaying debt over the long-term.
Alternatives to Personal Loans
When applying for a personal loan, it is crucial to ensure that you have found one of the cheapest loans available. Besides comparing interest rates and various fees, it is important to be sure that you are applying for the most relevant loan type. For example, it is typically more expensive to use a personal loan compared to a specific-use loan such as a home, car or education loan. If you are using a loan to pay for one of these expenses, you are likely to be offered lower rates from a specific-use loan compared to a personal loan. For this reason, while personal loans are financing tools for large or unexpected expenses, prospective borrowers should also be aware of other borrowing options that are available to them.
If you are not successful obtaining a personal loan, there are a number of licensed moneylenders that you may be able to secure a loan. Be sure to choose from the list of approved moneylenders from the Ministry of Law. Moneylenders are required by law to explain the nuances of their terms and conditions in easily understood language. However, interest rates are typically much higher than the personal loans you will find from banks, so make sure to compare rates and ask your lender any questions regarding the terms before securing the loan.
Methodology
In order to determine the list best personal loans for Singaporeans with bad credit, we collected data on all the personal loans from over 10 major loan providers in Singapore, listed in our table below.
We then created an algorithm to calculate the total cost of each loan in dollar terms. The total cost includes everything that a borrower ends up paying to the bank, which includes processing fees, administrative fees, interest payments. We considered benefits of promotions like fee waivers or cashback, which would decrease the total cost of a loan. We assume that all loan payments are paid on time, therefore avoiding fees like late payments or early payments.
Because these loans costs vary depending on the size and duration of the loan and required minimum income, cost is calculated for each duration range (1 to 5 years) and for each principal amount. By calculating each loan's total costs at different size, maturity and income level, we were able to arrive at the loans that cost the least to the borrower.
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Stephen Lee is a Senior Research Analyst at ValueChampion, specializing in insurance. He holds a Bachelor of Arts degree in International Studies from the University of Washington, and his prior work experience include risk management and underwriting for professional liability and specialty insurance at Victor Insurance. Additionally, Stephen is a former US Peace Corps Volunteer in Myanmar (serving between 2018-2020), where he continues to provide business development consulting services to HR companies in Asia Pacific.