History of Money Lending in Singapore: Exploring the Evolution and Current Practices

history of money lending

History of Money Lending in Singapore: Exploring the Evolution and Current Practices

Money lending has been an integral part of Singapore’s history, dating back to the early 19th century. Over time, the practice has evolved, and today it serves as a critical source of finance for individuals and businesses alike. In this article, we will explore the history of money lending in Singapore, its evolution, and its present-day practices.


Money lending in Singapore has undergone significant changes over the years. What began as a simple barter system evolved into a complex financial industry, providing critical support to individuals and businesses. Today, money lending is a regulated industry that caters to a diverse range of needs, from personal loans to business financing.

Early History of Money Lending in Singapore

Money lending in Singapore dates back to the early 19th century when the island was a British colony. At the time, the practice was largely informal and unregulated, with individuals and small businesses lending money to each other to meet their financial needs. The lending was usually based on trust, with little or no formal documentation.

Money Lending in the 20th Century

In the early 20th century, the money lending industry began to formalize. The British colonial government introduced regulations to ensure that moneylenders were licensed and registered. The government also established interest rate caps, which limited the amount of interest that moneylenders could charge.

In the years following World War II, Singapore experienced rapid economic growth, which led to an increase in demand for loans.

The government responded by relaxing interest rate caps, allowing money lenders to charge higher interest rates. This move led to a surge in the number of licensed moneylenders in Singapore.

Modern Money Lending in Singapore

Today, money lending in Singapore is a regulated industry, governed by the Moneylenders Act and the Moneylenders Rules. To obtain a license, money lenders must meet strict criteria, including having a physical office and maintaining a certain level of financial stability.

A legal money lender in Singapore is allowed to charge an interest rate of up to 4% per month, and they are prohibited from charging any other fees or charges beyond the allowed interest and permitted fees. Moneylenders are also required to provide borrowers with a loan contract that clearly outlines the terms and conditions of the loan.

Present-day Practices

Today, money lending in Singapore serves a diverse range of needs, from personal loans to business financing. A licensed money lender offers a variety of loan products, including payday loans, personal loans, foreigner loans and business loans. Loans are usually approved within an hour, and borrowers can receive the funds instantly upon completion of signed agreement on the same day.


Money lending has come a long way since its early days in Singapore. What began as an informal practice has evolved into a regulated industry that plays a critical role in the economy.

Today, licensed moneylenders in Singapore provide a vital source of finance for individuals and businesses, offering a variety of loan products and services. As the economy continues to grow and evolve, the money lending industry in Singapore is poised to play an even more significant role in the years to come.


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