Singapore is a place that is bubbling with activities at all times. It may be business, tourism, or education, and the location is one of the most sought-after destinations for all. However, at times, it becomes difficult to cope up with the financial plans. There is a planned need for funds to start a business or any unplanned expenditure to meet the emergency medical needs. Again, not all are fortunate enough to foot the bills for their child’s higher education or pay rents on time. So what does one do? Be a backbencher and miss the opportunities and face the hazards with mental pain and agony? Well no. It is time to take loans and keep the ship of hope afloat.
People staying in Singapore take loans from various financial institutions and banks to meet up their ends. It is easy to get a loan in Singapore as many legal moneylenders and banks offer them on easy terms. However, one should take the loans considering various factors. Let us discuss why people take a loan in the country. Many are many reasons but let us restrict the discussion to the top reasons.
Top reasons for taking loans
Although the reasons for taking loans vary from person to person, many people take loans in Singapore to have a better future or quality of life.
- Loan for business – Singapore is one of the countries where the economy centers on small and medium-scale industries or SME’s. Apart from that, almost all top-notch brands are present in the country, and they are running franchise stores and retail outlets. Everybody knows that there is a requirement of funds for entrepreneurs to participate in economic activity. Medium and small entrepreneurs find it challenging to raise money from the stock market and start their businesses. Moreover, many start-ups come up every day with a view to grow big and make a profit. It may be a manufacturing unit, a retail store, or a start-up marketing innovative ideas, and all need capital to begin their business. Therefore, the source of initial funding is a loan. It is best to approach a bank or legal money lender in Singapore for loans. They are always happy to provide loans with soft repayment terms following the government rules and regulations.
- Loan to meet emergency expenses – The emergency need for the fund can come at any time. Not all are well prepared with the funds to meet the emergency. It may be outstanding payments held up in the market, a medical emergency, some delay in getting the salary for some reasons, or to meet the prior financial commitments. A personal loan bails out from the situations at these times. Numerous government-approved and licensed moneylenders work in the money market and provide easy loans without much paperwork and hassles. In fact, the business of money lending is quite competitive in Singapore, and almost all money lenders come up with innovative ideas and competitive interest rates to give loans.
- Government capping on interest – Since the money lenders are licensed, the government of the country has complete control over them. The Singapore Government has put a capping on personal loans, and no moneylender can charge more than 4% monthly interest on the loan amount. With the low-interest rate, more and more people are taking loans to meet the unplanned expenditures. They pay the principal and the interest on time. Again, the volume of getting a loan is much higher. One can get 2 to 4 times loans of their annual salary and fulfill their urgent need or dreams.
- Increasing the credit score – Many people in Singapore believe that taking a loan and repaying it on time without any deferred payment can improve their credit score. In fact, a person or institution’s credibility increases much when the credit rating is more, and they can think of taking bigger loans in the future.
- Flexible terms and conditions: The terms and conditions set up by the banks and the private money lenders are flexible. One can negotiate on the repayment tenure, the interest rate, the processing fees, and many while taking a loan. Again, one requires significantly less paperwork for taking loans from licensed money lenders, unlike the banks. Therefore, people get encouragements to take the loans and go after them.
- Buying a property, car, or extending inventory in business- Space is premium in Singapore. It is not possible for everyone to buy a property without taking a loan. Almost all persons in Singapore dream of owning a home or a car of their choice. It isn’t easy to purchase them without taking a loan. Again an entrepreneur may be planning to add some inventory like pieces of machinery and gadgets to the existing facility. It is not always possible to invest from the profits. Therefore, taking a loan is the best option, and they go after them while doing business in Singapore.
The reason for taking a loan in Singapore differs from person to person. Any enterprise or person looks forward to meeting up the planned or unplanned financial demands. The Government of Singapore keeps a strict vigil on the moneylenders and punishes the moneylenders doing wrongful business. It gives a sense of trust in the borrowers, and they take loans without fear of burning a hole in their pocket while repaying.
Nobody can predict when the unplanned and emergency expenditures shall crop up. Therefore, people take personal loans to meet their ends. Again as the business environment is flourishing in Singapore, more enterprises are coming up, and they need money for their investments in the business. Not all are lucky to raise funds through the equity market. Therefore, they need to take a loan to run the show. Whatever may be the reasons, the people can get an easy loan in Singapore. Mentioned above are few top reasons for people taking a loan in Singapore, although there may be many others too? It is time to take a loan if you are eligible and stay relaxed.