Complaints against Licensed Moneylenders for Unfair Contracts and Practices

8 Mr Louis Ng Kok Kwang asked the Minister for Law (a) in 2015, how many complaints have been lodged against licensed moneylenders for unfair contracts and practices; (b) what action has been taken by the Ministry as a result of these complaints following the completion of the investigations; and (c) whether the Ministry detects an increasing trend of people borrowing from licensed moneylenders.

Mr K Shanmugam: In 2015, the Registry of Moneylenders received 129 reports lodged by members of public against licensed moneylenders. The reports included complaints against moneylenders charging high fees and interest rates, as well as extending credit in breach of the unsecured credit limits. The Registry also conducts regular inspections on moneylenders so as to ensure that their practices are in compliance with the Moneylenders Act and Rules. Where moneylenders or their officers are found to have committed offences under the Act or Rules, the Registry will take decisive action against them.

In 2015, 17 moneylenders were subjected to licensing action, such as revocation of licence and forfeiture of security deposit. Nine moneylenders or officers of moneylending companies were warned or offered composition, while six other such individuals were prosecuted and convicted in Court. These included matters that arose from complaints made in 2014.

In regulating the moneylending industry, we seek to maintain a balance between protecting borrowers and ensuring that there is reasonable access to credit from licensed sources. Over the last three years, there has been an increasing trend in terms of the value of loans granted by the industry. During the same period, a number of measures were also introduced to strengthen protection for borrowers, such as controls on interest rates and fees, which were implemented in 2015. We will be implementing further regulatory changes in the coming months.