The alternatives to personal loans in Singapore
Personal loans are one of Singapore’s most popular types of personal finance products. They allow you to borrow money for short-term expenses like home renovations, medical bills, and weddings.
However, there are some situations where it’s better to consider other options before getting a personal loan. Here are some alternatives that you can use instead.
Credit cards can be an alternative to personal loans if you need money for a short term and have bad credit.
They are also a good option if you want to make a purchase. Credit card interest rates are usually higher than personal loans, but this is offset by the fact that they don’t require security or collateral.
Credit cards allow you to borrow up to a certain amount of money at low-interest rates and make purchases using your card.
However, if you fail to pay back what you owe on time, late fees will apply as well as additional charges such as annual fees and administration charges (this may vary according to different banks).
Quick cash loans (aka payday loans)
Let’s start with the basics. Payday loans are small amounts of money you borrow for a short time.
Unlike personal loans, which typically last for more than a year and have fixed monthly repayments, payday loans usually have one-month repayment periods.
The problem with payday loans is their high cost: paying between $30 and $40 in fees for every $100 borrowed (depending on how much you borrow) is common.
That means that if you get a $300 loan from an internet lender at 3%, your repayment will be about $15 per month—more than twice what an interest-free personal loan would cost.
If you need fast cash and want to avoid the hassle of dealing with a bank, pawnbrokers are an excellent option. Here’s how they work:
Pawnbrokers offer loans against personal items such as jewelry or electronics. When you borrow money from a pawnshop, they hold onto your items until you pay off the loan (which can range anywhere from 3 months to 6 months).
The interest rates on these lenders’ loans are higher than those offered by banks; however, they’re still much lower than what payday lenders charge.
To apply for a loan at a pawnshop, bring proof of income (such as last year’s tax returns) and identification documents.
Collateral, such as jewelry, must be appraised before being accepted into the shop’s inventory; this may take place over several days depending on how busy their employees are at any given time during business hours (and since most shops only operate during normal business hours).
Online moneylenders are a good alternative to personal loans. Online moneylenders are fast and convenient, and they can be used for a variety of purposes.
Online moneylenders are an excellent option if you’re looking to consolidate your debts or even pay off your credit cards.
These are alternatives to personal loans when you need extra cash in a hurry.
There are several ways you can get extra cash in a hurry without taking out a personal loan. The first option is to go online and use your credit card to make your purchase.
Banks generally don’t charge interest on purchases made with their cards, but they charge interest on purchases made with other banks’ cards (and vice versa).
Just make sure you don’t spend money you don’t have, or else it could lead to some pretty hefty penalties down the road.
Another alternative would be getting a payday loan from an online lender like Wonga or MoneyMe. The good news about these loans is that they allow users to borrow money quickly and easily—but the bad news is that they also come with higher rates than traditional bank loans.
However, as long as you pay off what you owe each month before it becomes due, it’s not likely that this type of loan will cause any problems for you later on down the line.
If you’re looking for a personal loan in Singapore, we hope this guide has been helpful. There are so many options out there, and at first glance, it can be hard to know which one is right for your situation.
We recommend doing some research into different types of loans before making any decisions on what kind of financing you want or need.
But don’t worry, you don’t have to do all the heavy lifting yourself! That’s why we created this guide: so everyone else could help make informed decisions about their finances.