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Lending and Taking Security

Lending and Taking Security in Singapore in a Green Environment

In Singapore, a person who takes security over immovable property must register the security with the Registrar of Titles within 14 days of taking possession of the property. The Act also provides for the taking of possession of registered security by the secured creditor in certain circumstances. Aspects like personal budgets and home education are also taken into consideration while finalizing security for loans in Singapore. This article is about Lending and Taking Security in Singapore in a Green Environment.

Taking Loan Security in Singapore

Borrowers in Singapore will not be able to take a secured loan without collateral. This also differentiates secured loans from unsecured loans. The amount of loan which the borrower is going to receive would depend on the collateral they can provide to their moneylender. Choosing a secured loan in Singapore comes with a lot of benefits. Secured loans have low-interest rates. This can prove to be beneficial for someone with a good credit score and a solid monthly income, because of which the lender can charge a lesser amount of interest rate from the borrower.

If the value of the collateral is high, the borrower would be able to get a higher loan amount. Therefore, it is mandatory for the borrower to provide accurate and valid details and documents of their owning the asset.

Borrowers can even get better terms and conditions if they apply for a loan at licensed financial institutions. Someone with a poor credit score can easily get a secured loan based on the value of their collateral. In Singapore, borrowers can easily use their new or used vehicle, term deposits, equity in their home, and other high-value assets as collateral. In case borrowers are unable to repay the loan amounts, they must renegotiate these terms and conditions of the loan and have it restructured.

Further, debt consolidation can make the repayment process for secured loans easy. Secured loans come with their own sets of disadvantages too. The borrowers face a risk of their assets being sold if they fail to repay their loan amount on time. Taking up a secured loan also poses a risk to the borrower’s credit score if they fail to keep up with the repayment agreement of the loan. This can further create a hurdle if the borrower wishes to apply for any other loan from any licensed lending or financial institution in Singapore.

Issues related to Lending and Taking Security in Singapore

Banks typically demand that borrowers lend them money in return for the right to take their deposits in the event of bankruptcy. This procedure, known as contingent liability provision, or CLP, protects the majority of bank deposits in the nation. However, when taking out bank loans, borrowers must consent to this. In order to secure their accounts, banks also demand business owners take out business loans from them. High-profile failures, including those of Keppel Corp. and SP Setia, both owned by CapitaLand, have brought attention to the necessity for such safety precautions.

When bank accounts are past due, the banking system in Singapore is in danger. Banks typically enact harsher lending regulations, such as higher interest rates and quicker repayment terms, to mitigate this. Delinquent accounts may also be suspended or closed without the clients’ knowledge.

Banks utilize this tactic, referred to as “blacklisting,” to stop customers’ financial woes from spreading to their accounts. Sometimes banks would do this without telling the depositors or lenders who are their customers. As a result, numerous gullible consumers have dealt with account issues brought on by bank lending issues. Personal loans typically have higher interest rates than business loans because lenders have less stringent requirements for borrowers’ creditworthiness.


In Singapore, creditors may enter into contractual agreements or a deed of priority to work though rates and interests, considering their respective debts. It is necessary to enter into new security documents if an agent holds security for the lenders. It is expected that the new lender will assume all the rights and obligations of the original lender under the terms of the loan agreement. To effect this transfer, the original lender and borrower must agree to a novation, which is a new agreement that replaces the existing one. This process of replacement effectively discharges the security and allows the parties to enter into new, fresh agreements.

In Singapore, the Companies Act requires a company to have at least one shareholder and one director. There are no residency requirements for shareholders or directors, and companies may be 100% foreign-owned. The most common type of company in Singapore is a private company, which has a maximum of 50 shareholders. Public companies are required to have at least three shareholders and must file their financial statements with the Accounting and Corporate Regulatory Authority (ACRA). Directors must be able to show a corporate benefit when a guarantee is given by a subsidiary to secure the obligations of its holding company or another subsidiary of the same holding company.

Also, various guides such as Asia Pacific Guide, Practical Law Lending, and Taking Security Global Guide help to get information about lending and taking securities in Singapore.


If you are looking for ‘how do I get my credit bureau report’ in Singapore, then he/ she can request a copy of his/ her credit file online, at any of the SingPost branches, or at the Credit Bureau office. In Singapore, if a person wants to purchase a copy of his or her credit bureau report via eNets or Credit Card at just $6.42 (including GST). This payment can be made via eNets or a credit card. With this, the person will be able to view his/ her credit file online for the next 24 hours. If the person wants a physical copy of his/ her credit bureau report, he/ she can make a request at any of the SingPost branches or the Credit Bureau office.

Regarding loan security, this report will help the person to know how much outstanding he/ she has on his/ her loans and what is the maximum amount that the person can borrow from the bank. All this information is important for the person to take into consideration before taking a loan.

Final Words

The need for security over assets is a common commercial concern. In certain situations, a party may be willing to lend money or provide goods on credit only if that party has the right to take and sell the assets of the debtor in the event of default. The taking of security is, therefore, a way of mitigating credit risk. It is vital for the secured party to understand the nature of the security interest granted and the steps involved in perfecting and enforcing that interest.

Licensed Moneylender Singapore– Singa Credit Pte Ltd

Established in 1992 and previously known as Yong Seng Credit,
Singa Credit Pte Ltd is Licensed Moneylender in Bugis regularly updated with the latest regulations to be in line with the requirements set out by Registry of Moneylenders.

Please feel free to call 66946166 for more info on our lowest interest rate in Singapore or walk in our office 470 North Bridge Road #02-01 Bugis Cube Singapore 188735.

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