A lack of money can be distressing. If you’re in need of cash urgently, why not get a short term personal loan and use the loan to resolve the issue at hand? This way, you can get on with your life.

But that’s only if you know where to get a short term loan in Singapore. Some do not know that credit opportunities like these are available.

In this article, we explain what short term loans are, the types of short term loans available in Singapore, and where to get a short term loan.

What Is A Short Term Loan?

A short term loan is a form of credit offered with a short repayment period, usually one to 12 months. You can get it from banks and licensed money lenders.

A short term loan is primarily an unsecured loan, meaning you will not be asked to provide any collateral or give an account of your net personal assets. But the amount you can get is limited to between $500 and $35,000.

The approval time for short term loans is quick, typically 24 hours. But still, lenders will conduct their due diligence by checking your credit history, income, and other criteria depending on their policies.

The repayment terms and conditions for short-term loans depend on the stipulations of your agreement with the lender.

So as you search for where to get a short term loan, ensure that you check out different lenders’ offerings to get the most favourable one.

Pros And Cons Of A Short Term Loan 

When deciding to apply for a short term loan, be sure to take into account these pros and cons.


It’s Convenient

The application process for short-term loans is quick and straightforward. The approval process is also conducted quickly, often within a day.

Most lenders do not ask for collateral, which makes the loan accessible to many and reduces any risks of losing an asset.

More Lenient

Short-term loan requirements and credit checks are usually less stringent than those of regular loans. Often, the credit rating and annual income are considered.

Licensed money lenders in Singapore in particular, are known to be very lenient. So even if your credit score is poor, you may still qualify for a short term loan.

Low Interest

Since the repayment period is very short, the interest you will be asked to pay will be less than the amount you would pay for a long-term loan.

In addition, since many lenders offer loans on nominal interest rates, the interest amount does not vary with changing market conditions, which keeps its costs low.

But note that the loan is only cheap if you keep up with the monthly payments. Fines and charges incurred for late or missed payments could cause you to pay back way more than you anticipated.

It’s Accessible

As money lenders and financial institutions in Singapore digitise many of their functions, you no longer need to look for a physical location when it comes to where to get a short term loan.

You can now apply for loans online, at your convenience. It’s only after the loan approval that you will be asked to visit the lender for an in-person verification before the cash is disbursed to you.

It is mandatory for a licensed money lender to verify your identity in person and give you the cash at its office.

It’s Flexible

Short-term loans allow some flexibility for repayments. For example, you may make your payments every week, two weeks, month, or on your payday.

Choose a repayment schedule that coincides with when you get paid to avoid missing payments.


Small Loan Amounts

With short-term loans, you will receive relatively small amounts that are limited by the short repayment period.

Attracts A Processing Fee

You will be asked to pay a processing fee. Although it’s usually a small amount, it adds to the total cost of the loan.

Has A Higher Interest Rate

Short-term loans typically have an interest rate higher than long-term loans. This is because this line of credit works by charging a high interest for a short period, so that the lenders can make a profit.

Risk Of Complacency

Since the amount borrowed is low and the duration is short, you may become complacent, thinking you can quickly repay the loan.

You end up forgetting to make your payments, and end up attracting lateness fees and interest. In the end, the small loan builds up to an overwhelming amount that can be challenging to repay.

Low Interest Rates Only Applies During the Loan Term

The low nominal loan interest is only applicable during the designated loan term.

If the term expires and you’ve yet to finish paying, the interest rate shoots up, further increasing the cost of the loan.

Some may make the mistake of taking out a short term loan to pay off the first. Without some discipline and a proper loan repayment plan in place, they thrust themselves into an endless circle of debt.

Types Of Short Term Loans In Singapore

Short term loans come in the following forms:

1. Emergency Cash Loan

An emergency loan is also known as a “crisis loan”. It is disbursed quickly to help pay for unexpected, sudden expenses such as a broken-down car, a medical bill, and other unforeseen costs.

2. Payday Loans

A payday loan is when the lender issues a post-dated cheque that you can cash in on a confirmed date in the future.

The cheque is linked to your bank account. On payday, your bank deducts the money lent, along with interest accrued.

This loan type is easy to obtain and is usually an alternative to an emergency cash loan for those with a low credit rating.

An important fact to note is that a payday loan attracts high interest, so only ask for the loan when you really need it.

Also, since it’s deducted as a lump sum, you must stash away some money as a buffer for yourself when the lump sum is deducted from your pay.

Otherwise, you may end up applying for another short term loan or getting into other types of debt.

3. Line Of Credit

A line of credit works like a business credit card. It has an established credit limit, and you can tap into it as needed to pay for expenses.

The credit limit set depends on several factors such as your credit score, source of income, income amount, and other parameters set by the lender.

The advantage of using a line of credit instead of getting a credit card is that the interest rate for a line of credit is lower than if you were using a credit card.

Also, its repayment period is flexible, according to the terms of the loan you and the lender agreed on.

4. Invoice Financing

This is a business loan you get with the backing of your business account receivables, meaning that you use your customers’ invoices to seek money from a money lender. Typically, lenders issue a loan amounting to 80% of the amount owed. When your customers pay up on the invoices’ due date, the lender deducts the money owed.

This includes the interest charged. The lender then sends the balance to you.

5. Merchant Cash Advance

A merchant cash advance is a cash advance issued based on a business’s credit card sales.

A small business applies for this loan type, and the lender instantly deposits some money into the business bank account.

You can also apply for this loan type, but in his case, the lender credits the amount borrowed.

When it comes to repayment, for either the personal or business loan, you give the money lender permission to access your credit facility.

The lender deducts an agreed-upon percentage of the credit card receipts, an amount called a holdback. It then continues to deduct it periodically throughout the repayment period until the loan is repaid.

Where To Get A Short Term Loan In Singapore

Having known about the kinds of loans available, the next step is to know where to get a short term loan in Singapore to keep yourself from falling prey to a loan shark.

The options for short term loans in Singapore include the following:

1. Banks

Banks are a good source of credit in Singapore. They use money deposits from customers to finance others and, in the process, earn some interest.

Since they use other people’s money, banks are quite stringent in their loan requirements. The application process can be prolonged because of the checks and the ton of paperwork involved.

2. Licensed Money Lenders

Money lenders like Credit 21 are non-bank organisations that offer credit in Singapore under the supervision of the Ministry of Law.

Money lenders are less stringent in their evaluation of customers, but for the higher level of risk undertaken, the interest rates charged also go up.

Nevertheless, for most, the interest rate is not a deterrent to applying because they can access the credit fast. Sometimes, it’s the only line of credit available to them.

It’s Easy To Get A Short Term Loan In Singapore

If you’re considering taking a loan, get it from Credit 21.

We offer custom financing solutions to those in need of quick cash and have reasonable terms of credit.

Our loan application process is easy, and the approval only takes 24 hours.

Contact us today or apply for a loan now and we will get back to you promptly.