Financial difficulties may sometimes seem too big to overcome. You may have been tempted to contact a loan shark to solve these issues. Or you unwittingly started dealing with one, having at first believed it was operating legally.

Now, you may feel distraught and trapped.

Remember that nothing in this life is without a solution – you just have to keep a clear mind. We are here to help with a complete guide on how to run away from loan shark or “Ah Long”.

We will analyse tell-tale signs, how to deal with harassment, and where to get help. We will also discuss ways of handling overwhelming debt, so keep reading.

How To Know If You Are Dealing With A Loan Shark

Loan sharks in Singapore are extremely dangerous, so it is important to recognise the red flags before getting into business with them. 

But sometimes, they can fool you into believing they operate legally. But they will show their true colours after some time.

Red Flags Before Getting A Loan

If you are dealing with a loan shark, before you get the loan, you will find that:

  • The potential loan shark is not listed on the list of licensed money lenders updated by the Ministry of Law (MinLaw).
  • They are not on the exempt list either.
  • A potential “Ah Long” advertises its business either online or outdoors. Legal money lenders in Singapore are only allowed to advertise in:
    • Business and consumer directories
    • Their websites
    • Their office (e.g. walls, doors, windows, etc)
  • Loan sharks tempt you with larger personal loans than the legal limit. MinLaw has established several caps for unsecured personal loans from money lenders that “Ah Longs” do not respect:
    • Six times the maximum monthly earnings for those earning over $20,000 per year
    • $3,000 for Singaporeans, permanent residents, and foreigners earning between $10,000 and $20,000 per year
    • $3,000 for Singaporeans and permanent residents earning less than $10,000 per year
    • $500 for foreigners earning less than $10,000 per year
  • Loan sharks are manipulative. Instead of checking your loan documents at their official headquarters, they will attract you with too-good-to-be-true promises and offer money in informal (sometimes iffy) places.
  • They do not offer loan contracts. As such, they will not have fixed terms and conditions that you can follow to reimburse the loan.
  • Loan sharks may ask for a loan processing fee to hasten loan approval or to offer you a larger loan amount. Remember, legal money lenders in Singapore do not ask for any loan downpayment prior to loan approval. 

Red Flags After Getting A Loan

After getting your loan, you will notice that the loan shark changes its tune. Instead of being helpful, it starts acting rude and even dangerously:

    • Loan sharks impose very high interest rates and installments that vary throughout your tenure, thus robbing every certainty from your reimbursement process. They can even double your loan without notice. Instead, licensed money lenders in Singapore are limited to a maximum of:
      • 4% per month interest rate from your outstanding balance
      • 4% per month late interest rate from the payment(s) you missed
      • $60 late penalty fee
      • 10% admin fee from the principal amount
  • Loan sharks become violent when you cannot respect their conditions:
    • They can threaten, abuse, blackmail, or hit you or your loved ones. 
    • They can destroy your property.
    • Some loan sharks may try to withhold your documents or ask for your banking passwords as insurance that you will repay your loan.
    • Some may demand you to threaten other individuals as a way to gain their goodwill.

What Happens When You Don’t Pay A Loan Shark 

If you are thinking of how to run away from loan shark, the first step is stopping all interactions – payments included. You will also have to contact the authorities, but we will explain that in the section below.

For now, here is what happens when you do not pay a loan shark in Singapore:

  • You might get threats and blackmails.
  • Your property might be destroyed. 
  • The “Ah Long” will dramatically increase your loan and the penalty for not paying it.
  • You might get messages and incessant calls in the middle of the night.
  • The loan shark might give your number and address to other loan sharks.
  • Your loved ones might be in danger.

Remember: All these are reasons to contact the authorities immediately. With police protection, the loan sharks will not be able to harm you anymore.

That brings us to the following point.

How To Deal With Loan Shark Harassment In Singapore 

Here are the steps on how to fight loan shark harassment in Singapore:

  1. Stop repaying the “Ah Long”. We have explained this part in the section above.
  2. Change any information you gave to the loan shark. Consider any phone numbers, e-mails, passwords or other data you disclosed. You may not be able to move your home or workplace, but you can modify that information.
  3. Contact the authorities, starting with the police. If you are in danger, call 999. If you are not in danger, call:
  • Police hotline for crime-related info: 1800 255 0000
  • Loan shark helpline Singapore: 1800-924-5664
  • Registry of Moneylenders: 1800-2255-529
  1. Keep any proof of the loan shark’s illegal behaviour. This evidence may include recordings, messages, a list of calls, e-mails, photos of any damaged property, etc.

Warning: Loan shark harassment is different from licensed money lender harassment. If a legal money lender gives you a hard time, the Registry of Moneylenders will be your first bet because they are not usually as dangerous as an “Ah Long”.

Punishment For Loan Sharks In Singapore 

Once you denounce the “Ah Long” using the loan shark Singapore hotline, the police will start investigating your case.

Remember: It is essential to learn how to run away from loan shark to save yourself and other potential victims. After being arrested, the loan shark will be tried. The punishment for loan sharks in Singapore depends on the severity of their actions. 

The bare minimum for a first-time offender who has committed harassment is:

    • Jail: Up to five years
    • Fine: Between $5,000 and $50,000
  • Strokes of the cane: Three to six (for men) 

Warning: It is an offence to borrow from a loan shark, but the punishment is minimal as long as you do not aid the “Ah Longs”.

So if you allow them to use your credit card, disclose any personal information, or help them harass their other clients, your punishment may be:

    • Jail: Up to five years
    • Fine: Between $5,000 and $50,000
  • Strokes of the cane: Three to six (for men) 

Where To Get Help

Some organisations in Singapore help and teach people how to solve loan shark problems in Singapore. Here is where you can reach out for help:

  • Loan Shark Helpline: Set up by the Singapore government, this hotline provides resources and support for both loan shark victims and those who want to avoid falling into an “Ah Long” trap. You can contact this loan shark hotline at:
  • ComCare: 1800-222-0000
  • Credit Counselling Singapore: 6225 5227

Pro tip: If you have accumulated a lot of debt, you may restructure it using a debt consolidation loan. Alternatively, consider an emergency loan to solve urgent financial issues.

U Credit has experience with both loan packages and helping our clients. Our longstanding reputation in the Singapore market enables us to craft customised financial solutions and give you our professional support.

Get help from our friendly loan officers or get started by applying for a loan now.