The credit scoring framework for personal loan eligibility in Singapore has seen some changes recently. According to new norms, applicants who are PRs or have permanent resident (PR) status need to meet the minimum employment period of two years instead of the previous year under the ‘A’ criterion. On the other hand, applicants with an existing/ongoing mortgage loan can only apply if they have held it for more than 24 months.

Before this update, permanent residents were treated as citizens. They hence were not required to meet any minimum period of employment before applying for the best personal loan Singapore. Now, PRs will be assessed alongside locals based on their income stability (i.e., via EP or CSS) during the past two years.

Generally speaking, applicants who have greater stability of income (and hence better credit profiles) will be able to borrow more.

Eligibility Scoring Framework in Singapore

Employment Period (EP) Criterion for PRs

Applicants without a 2-year employment history must meet the additional ‘C’ criterion. Applicants with an existing/ongoing mortgage loan are excluded under this criterion.

Criterion A: Applicant has held a Singapore Employment Pass (EP) continuously for at least one year or more or equivalent

Criterion B: In cases where the applicant does not fulfill the above criteria, they must have EP for at least one year, and the total tenure of all current active loans held by them must be for more than 24 months. This will hold regardless if the applicant is a permanent resident or a citizen of Singapore. If the borrower does not fulfill these criteria, only 50% of a gift from immediate family members will be allowable.

Applicants must also fulfill one of the following two criteria before applying for personal loans: Area C EP > 2 years – All other cases; or total tenure of all current active loans held by the applicant is > 24 months.

Criterion C: Applicants must also meet at least one of three following criteria before applying for personal loans:

  • EP or CSS has remained current and active for a minimum period of 24 months. Applicants will be able to borrow up to 50% of the total gift amount until they meet Criterion A or B.
  • Applicant has held a Singapore Permanent Residency (PR) for at least two years, and EP/CSS, which is older than two years, has not remained EP/CSS for three consecutive years. Here, applicants are required to include details on gift sources and transfer arrangements, which must be verifiable.
  • Applicant has held a Singapore Permanent Residency (PR) for at least two years, EP/CSS older than two years but not older than three years. Applicants can borrow up to 50% of the total gift amount until they meet Criterion A or B.

What Are the Minimum Employment Period Requirements for Permanent Residents?

The minimum employment period requirement for PRs has changed drastically. To apply for the best personal loan in Singapore, they now need to meet the same criteria as citizens (i.e., with EP or CSS), albeit under slightly different circumstances. Before these changes, PRs were not required to meet any minimum employment requirements before applying for personal loans in SG.

Now, they will be assessed based on their income stability during the past two years. Applicants with more stable incomes are typically given higher personal loan limits as they are less risky to credit providers.

What Does This Mean to Borrow Money from Moneylenders?

This means that PRs will be assessed similarly to citizens – at least for personal loans. PRs must meet one of three main criteria before they can be considered:

  • Have an EP or CSS for at least two years, not older than two years. As mentioned previously, this applies even if the PR is applying for a personal loan jointly with immediate family members. Applicants can only borrow up to 50% of the total gift amount until they fulfill Criterion A or B.
  • Have an EP or CSS older than two years but have not remained EP/CSS over three consecutive years. This applies even if the PR is applying for a personal loan jointly with immediate family members. You can borrow up to 50% of the total gift amount until they meet Criterion A or B.
  •  Have an EP or CSS that has remained for over three consecutive years. This applies even if the PR is applying for a personal loan jointly with immediate family members. This means that they are not required to include details on gift sources and transfer arrangements, which must be verifiable.

Getting the best personal loan in Singapore shall not be difficult if the criterions mentioned above are duly met by the applicant. At first glance, this change will mainly affect PRs applying for personal loans jointly with family members who are citizens. But, potential abuse could be stopped by ensuring that PRs meet at least one criterion before getting approved for a personal loan.

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