Personal Loans

Best Personal Loans 2017

Personal loans are very popular in Singapore for people who are in urgent need for money. To help people in Singapore find the best personal loan available, we have gathered data and analyzed offerings from each bank in Singapore. To find the best loan, you need to look for the lowest effective interest rate for the amount you need, while making sure you can easily manage the loan's monthly repayment. Below, we feature the best installment personal loans and make recommendations on which one you should choose depending on your circumstances.

Table of Contents

Our Top Picks for the Best Personal Loans in Singapore

The following loan products, in our opinion, represent the best deals currently available for people in Singapore. To find the best deal, we assess the total cost you would need to pay in processing fees and interest. Since the average cost of personal loans is around 13%-15% depending on loan tenure, you want to find an offer with an effective interest rate of 11% or lower. You should also try to minimise the length of your loan tenure while making sure you can comfortably afford the monthly repayment schedule.

comparing the effective interest rates of the best personal loans in Singapore to help consumers find a personal loan with the lowest interest rate. We assume a loan tenure of 3 years and an annual income of at least S$30,000

Best Large, Long-Term Personal Loan: HSBC Personal Loan

For people who need a large personal loan but can't handle large monthly repayments, HSBC Personal Loan can be an ideal choice. First, HSBC Personal Loan's is the only loan that provides tenures up to 7 years (instead of 5 years for most other banks), which allows you to reduce the financial burden of large monthly instalment by spreading it out over a long period of time. Secondly, HSBC's effective interest rate of 9-10% is easily one of the lowest in the market especially for 3-7 year tenures. HSBC also waives its S$88 processing fee and provides a cash back of S$50 for online application.

The only downside of HSBC Personal Loan is that it requires a S$10,000 of minimum loan amount to enjoy these promotional rates. If you are a Premier or Advance customer, you can enjoy an even better deal with interest rates of 7% and 8% effective interest rates and no minimum loan requirement.

Summary of HSBC Personal Loan's Interest Rates and Features

Interest Rate by Duration (Year)Flat RateFeeEffective Interest RateMonthly Instalment*Total Cost*
15.5%S$010%S$879.17S$500
25.4%S$010%S$461.67S$1,030
34.8%S$09%S$317.78S$1,390
44.9%S$09%S$249.17S$1,910
54.9%S$09%S$207.5S$2,400
65.0%S$09%S$180.56S$2,950
75.0%S$09%S$160.71S$3,450
Eligibility: S$30,000 of annual income (S$40,000 for foreigners)
Max Size: 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 Size: S$10,000 Minimum Loan Size to enjoy the 9% EIR promotional rate (absolute minimum is S$5,000)
Approval: Same day approval (as quick as 1 minute), next day cash delivery with submission of valid documents
Promotion: S$50 cash rebate & annual fee waiver exclusively for online applications
*Assuming S$10,000 of loan, total cost includes impact of promotions

Best Small, Short-Term Personal Loan: Citi Ready Credit Paylite

For people who need a small personal loan to pay down quickly within 3 years, Citi Ready Credit Paylite is likely one of the best options in the market. For loan maturities from 1 to 3 years, Citi Ready Credit Paylite's effective interest rates of 9% is the lowest we've seen in the market. To break down the cost further, Citi Ready Credit Paylite charges zero processing fee, and its flat rate ranges from 4.82% to 5.79%. Not only that, Citi’s minimum loan amount is only S$1,000 compared to HSBC’s S$5,000, making it very accessible for anyone who may only need to borrow a few thousand dollars.

Summary of Citi Ready Credit Paylite's Interest Rates and Features

Interest Rate By Duration (Year)Flat RateFeeEffective Interest RateMonthly Instalment*Total Cost*
14.94%0%9.0%S$874.5S$494
24.82%0%9.0%S$456.83S$964
34.83%0%9.0%S$318.03S$1,449
45.72%0%10.5%S$256S$2,288
55.79%0%10.5%S$214.92S$2,895
Eligibility: S$30,000 of annual income (S$42,000 for foreigners)
Loan Size: S$1,000 Minimum, S$100,000 Maximum (4x monthly salary)
Approval: Same day approval (1 hr before 5PM)
*Assuming loan of S$10,000, total cost includes impact of promotions

Best Personal Loan for Low Income Borrower: Standard Chartered CashOne

For low income borrowers who make less than S$30,000 per year, Standard Chartered CashOne is the best personal loan with the lowest interest rates. For people who make between S$20,000 S$30,000 per year, Standard Chartered only charges 9.8%-10.8% of flat rate with a waived processing fee. This roughly translates to 21-28% of effective interest rate, depending on the loan’s tenure. In comparison, other personal loans for low income borrowers typically charge between effective interest rate of 11-13% of flat rate plus up to 4% of processing fees with EIR going above 30%.

The downside of this loan, on the other hand, is that it has a maximum loan cap of S$5,000 or 2x your monthly salary, whichever is lower. However, if you make less than S$30,000, we strongly advise you against borrowing more than this amount in the first place. Therefore, if you are looking for a few thousand dollars of loans and you make less than S$30,000, Standard Chartered CashOne is the best personal loan you can find in Singapore.

Summary of Standard Chartered CashOne's Interest Rates and Features

Interest Rate By Duration (Year)Flat RateFeeEffective Interest RateMonthly InstalmentTotal Cost*
19.80%S$027.6%S$458S$390
29.80%S$023.1%S$249S$880
310.80%S$023.0%S$184S$1,520
410.80%S$021.8%S$149S$2,060
510.80%S$020.9%S$128S$2,600
Eligibility: S$20,000 of annual income (S$60,000 for foreigners)
Loan Size: 2x monthly salary for annual income below S$30,000; 4x monthly salary for annual income above S$30,000 (up to S$200,000)
Approval: Receive cash the next day
Processing Fee: S$199 for 1st year (waived for online application), S$50 for subsequent years (waived for borrowers who make repayments on time)
Promotion: S$50 cashback for online application + Up to S1,088 of cashback on loan (1% cashback for loans under S$50,000, 1.5% for loans over S$50,000)
*Assuming Annual Income below S$30,000, loan of S$5,000, total cost includes impact of promotions

Personal Loan with the Quickest Cash Disbursement: DBS/POSB Personal Loan

For people who need cash immediately, we recommend getting a personal loan from DBS or POSB. While most other banks approve your application the same day, they usually disburse the actual loan on the next day. However, DBS and POSB provide the loan instantly if you already have a credit card or personal line of credit from them. On the other hand, however, DBS & POSB's personal loans's effective interest rates range from 13% to 20%, rather expensive compared to other options we showcased above. Furthermore, although DBS & POSB provide this loan for people who make less than S$30,000 per year, their processing fees and interest rates can be 40-98% higher than what are shown below. Overall, we recommend this product for people who absolutely need the cash right away.

Summary of DBS/POSB Personal Loan's Interest Rates & Features

Interest Rate By Duration (Year)Flat Rate*Fee*Effective Interest Rate*Monthly Payment*Total Cost*
17.99%3%19.7%S$899.92S$911
27.99%3%17.28%S$483.25S$1,710
36.99%2%13.96%S$326.78S$1,776
46.99%2%13.5%S$257.33S$2,364
56.99%2%13.14%S$215.67S$2,952
Eligibility: S$20,000 of annual income
Loan Size: 4x monthly salary, 10x if your annual income is S$120,000 and above
Approval: Immediate approval & disbursement for DBS & POSB credit card or line of credit customers
Promotion: Up to S$600 in NTUC Vouchers depending on your loan amount
*Assuming Annual Income above S$30,000, loan of S$10,000, total cost includes impact of promotions

Best Personal Loans by Dollar Cost

Below, we show total cost for each personal loan product in Singapore that we've collected. To help you find the best personal loan for your circumstances, we have prepared a visual analysis of how much it will cost you to get funding. We assume that the borrower makes at least S$30,000 annually, and that he borrows S$10,000 over 3 year. For such a loan, you should expect to pay somewhere between S$1,300 and S$2,700 in fees and interest. This cost does not reflect other possible penalties like late or early payments, which we typically advise against.

Comparing the total cost of personal loans from every bank in Singapore in terms of interest payment, assuming S$10,000 of personal loan over 3 years
Cost of Personal Loan by Bank

Summary Table of Best Personal Loans in Singapore

Please refer to our summary table below for all the personal loan offerings in Singapore.

S$10,000 Personal Loan Over 3 YearsEffective Interest RateTotal CostMin Annual Income
HSBC Personal Loan9.0%S$1,390S$30,000
Citi Ready Credit Paylite9.0%S$1,449S$30,000
Standard Chartered CashOne10.4%S$1,554S$30,000
DBS/POSB Personal Loan12.0%S$1,776S$30,000
UOB Personal Loan14.6%S$2,400S$30,000
OCBC ExtraCash Loan17.7%S$2,681S$30,000
Standard Chartered CashOne14.0%S$2,100S$20,000
DBS/POSB Personal Loan21.7%S$3,5120S$20,000
OCBC ExtraCash Loan26.4%S$3,850S$20,000

How to Choose the Best Personal Loan

Before you take out a personal loan, you should always consider if this is the right option for you. Although they are better than credit card debt, personal loans still come at a relatively high price. Interest rates and other terms can also vary greatly based on your annual income and other factors. Therefore, here are some parting thoughts and advices for those who want to take out a personal loan.

  • 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 need to 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 balance the above two numbers as much as possible. 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

When evaluating a personal loan in Singapore, it’s very important to consider both its flat rate and its effective interest rate (EIR). To explain the difference, flat rate is the number you use to calculate how much interest you owe on the loan. For example, if you borrow S$10,000 at 5% flat rate over 5 years, you have to pay S$500 in interest per year for the next 5 years.

In contrast, EIR represents the true economic cost of the loan that takes into account processing fees and your loan repayment schedule. The crucial concept to understand is that you don’t get to use the full amount you borrow for the entire duration of your loan because you have to pay the processing fee and your principal payment back to the bank. In other words, you are paying some money back every month but that has no impact on reducing your interest payment.

Therefore, you have to carefully examine both numbers when shopping for a personal loan. Flat interest rate will determine how much you have to pay back to the bank on a monthly basis. EIR will tell you what the loan is really costing you economically. Don't be tricked into thinking that a personal loan is only going to cost you 4-8% by looking at its flat rate. In reality, it is really costing you 12-20%, 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, most banks will require a minimum annual income of S$30,000, though some banks lend to people with as little as S$20,000 of annual income. For foreigner, this limit increases to $40,000-S$60,000 depending on the lender.

In terms of documents, you will likely need to provide the following to the lender to be approved:

  • 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 in Singapore, you can learn more about what personal loans are and how much they cost in our guide.

Methodology

To arrive at our best personal loan list for Singapore, we collected data on all the personal loans from over 10 major loan providers in Singapore, listed in our table below.

Personal Loan Lenders in ValuePenguin's Study
DBS/POSBOCBCUOBHSBCCitibank
Standard CharteredMaybankCIMBANZRHB

Then, we created an algorithm that calculates how much a loan costs in dollar terms. This cost includes everything that a borrower ends up paying to the bank outside of the loan amount itself, which includes processing fees, administrative fees, interest rates. We also take into account benefits of promotions like fee waivers or cashback, which would decrease the total cost of a loan. We assume that each monthly installment is paid on time, therefore avoiding other penalties like late payments or early payments.

Because these loans come with different costs 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 mapping out each loan's total costs at different size, maturity and income level, we were able to arrive at the above list that costs the least to the borrower.

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