What is a debt consolidation plan
Debt consolidation plan, also commonly known as DCP, is a refinancing scheme that was rolled out by the Association of Banks in Singapore to cater to those who are facing difficulty meeting payments for their unsecured debts. The DCP allows a client to bring together all their existing outstanding debt across multiple financial institutions into a single loan with one lender.
This can be offered by banks or licensed moneylenders. If the application is approved, the issuing lender pays off the client’s outstanding debts so that they only need to focus on paying one loan. The loan is often offered at a lower interest rate and the monthly repayment is fixed for a certain period.
Top debt consolidation plan providers in Singapore
Here are some of the top banks and licensed moneylenders offering debt consolidation plans in Singapore:
Plan Provider |
HSBC |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.hsbc.com.sg/ |
Address | Check for locations here |
Telephone | 6472 2669 |
Operating Hours | Check website for operating hours |
Plan Provider |
POSB |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.posb.com.sg/personal/default.page |
Address | Check for locations here |
Telephone | 6878 6887 |
Operating Hours | Check website for operating hours |
Plan Provider |
Standard Chartered Bank |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.sc.com/sg/ |
Address | Check for locations here |
Telephone | 6747 7000 |
Operating Hours | Check website for operating hours |
Plan Provider |
Citibank |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.citibank.com.sg/portal/bluehome/index.htm |
Address | Check for locations here |
Telephone | 6397 4888 |
Operating Hours | Check website for operating hours |
Plan Provider |
Bank of China |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.bankofchina.com/ |
Address | Check for locations here |
Telephone | 1800 338 5335 |
Operating Hours | Check website for operating hours |
Plan Provider |
Maybank |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.maybank2u.com.sg/en/personal/index.page? |
Address | Check for locations here |
Telephone |
1800 629 2265
|
Operating Hours | Check website for operating hours |
Plan Provider |
HL Bank Singapore |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.hlbank.com.sg/en/personal-banking/home.html |
Address | 7 Wallich St, #B1 – 25 and #B1- 26, Singapore 078884 |
Telephone | 6349 8330 |
Operating Hours | Weekdays 9AM – 4PM Closed on weekends |
Plan Provider |
UOB |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.uob.com.sg/personal/index.page |
Address | Check for locations here |
Telephone | 6715 5690 |
Operating Hours | Weekdays 9AM – 6PM |
Plan Provider |
OCBC |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.ocbc.com/group/gateway? |
Address | Check for locations here |
Telephone | 6363 3333 |
Operating Hours | Check website for operating hours |
Plan Provider |
CIMB |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.cimb.com.sg/en/personal/home.html |
Address | Check for locations here |
Telephone | 6333 7777 |
Operating Hours | Check website for operating hours |
Plan Provider |
American Express |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.americanexpress.com/en-sg/ |
Address | Check for locations here |
Telephone | 1800 299 1997 |
Operating Hours | Check website for operating hours |
Plan Provider |
Orange Credit |
Speciality |
|
Pricing | Contact for quotation |
Website | https://orangecredit.com.sg/ |
Address | 810 Geylang Rd, #01-91 City Plaza, Singapore 409286 |
Telephone | 6748 2320 |
Operating Hours | Weekdays 11AM – 8PM Saturdays 11AM – 3PM Closed on Sundays |
Plan Provider |
TCC Consolidation Loan |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.tcc.org.sg/ |
Address | 95 Killiney Road, Singapore 239537 |
Telephone | 6319 3700 |
Operating Hours | Weekdays 8.45AM – 6PM Saturdays 9AM – 1PM Closed on Sundays |
Plan Provider |
Lending Bee |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.lendingbee.com.sg/ |
Address | Check for locations here |
Telephone | 6219 1611 |
Operating Hours | Weekdays and Saturdays 11AM – 8PM Sundays 10AM – 7PM |
Plan Provider |
KST Credit |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.kstcredit.sg/ |
Address | 220 Orchard Rd. Midpoint Orchard #01-01, Singapore 238852 |
Telephone | 6255 5225 |
Operating Hours | Weekdays 10.30AM – 7.30PM Weekends 10.30AM – 4PM |
Plan Provider |
Capital Funds Investments |
Speciality |
|
Pricing | Contact for quotation |
Website | https://www.loancfi.com.sg/ |
Address | 65 Ubi Crescent #06-07, Hola Centre, Singapore 408559 |
Telephone | 6281 7736 |
Operating Hours | Weekdays 12PM – 8PM Saturdays 11AM – 3PM |
Plan Provider |
Cash Direct Pte. Ltd. |
Speciality |
|
Pricing | Contact for quotation |
Website | https://cashdirect.sg/ |
Address | Vision Exchange, 2 Venture Drive #01-21, Jurong East Central, Singapore 608526 |
Telephone | 6493 0088 |
Operating Hours | Weekdays and Saturdays 11AM – 8PM Sundays 12PM – 5PM |
Plan Provider |
HHL Credit Pte. Ltd. |
Speciality |
|
Pricing | Contact for quotation |
Website | https://hhlcreditpl.com/ |
Address | 1 Rochor Canal Rd, #01-04, Singapore 188504 |
Telephone | 6732 1998 |
Operating Hours | Weekdays 11AM – 8PM Saturdays 11AM – 7PM Sundays 10AM – 5PM |
When to opt for a debt consolidation plan
Once you have fallen deep in debt with several credit cards or creditors, it can be stressful to juggle with multiple overdue payments. Having those persistent reminders about your outstanding amount constantly breathing down your neck can be overwhelming. If you currently have an outstanding debt of more than 12 times of your monthly salary, the DCP is a recommended option for you.
It is important to note that the DCP is only catered for some types of unsecured loans such as personal instalments or credit cards. Other types of loans like education loan, housing loan, car loans or business loans cannot be consolidated under DCP. As the loan has a potentially lower interest rate and a fixed monthly payment period, it should help to save on the overall interest payment. This should eventually help to eliminate that neverending debt repayment cycle more efficiently over time.
Who is eligible for a debt consolidation plan
In times of financial crisis, DCP can be an option to help one manage their debt problems. However, not everyone is eligible to apply for DCP. To be eligible for DCP, you need to meet the following requirements.
First, you must be a Singaporean Citizen or Permanent Resident age at least 18 years and above as of the date of application.
Secondly, those with an annual income between $20K and $120K or net assets of less than $2 million can apply.
Lastly, the total unsecured credit on all credit cards and unsecured loans should exceed at least 12 times of your monthly income before you can request for a DCP.
If you are unsure whether you qualify for the requirements, consult your financial institution. Often they will also be able to recommend a suitable loan tenure based on your current financial status.
Advantages of debt consolidation
When you are drowning in too much credit card debt, the DCP can help you to manage your monthly repayments and eventually be freed from debt. Here are some of the advantages offered by debt consolidation plans:
Easier tracking and planning
During the application process, the financial advisor will work out the amount required to be paid on a monthly basis based on your loan tenure. By consolidating your debt into a single loan, you only have to make one payment instead of having to manage multiple accounts. This makes it easier to keep track of your payment schedule.
Potentially lower interest rates
Most credit cards have high interest rates and can continue to rack up massive amounts of interest each month if not paid on time. DCP helps to pay off multiple high interest debt accounts and consolidates them into a single account, often at a lower interest rate. Generally, the shorter the loan tenure, the lower the interest rate and vice versa. Do look out for offers as some providers bundle the DCP with promotional interest rates and cashbacks that may help you save extra money.
Enforces financial discipline
Debts can take years to be fully paid off. With DCP, it takes into consideration your income, loan tenure, credit score, current debt and other factors to come up with a repayment plan. This helps to reduce the overall payback period of your debt. It also helps to consolidate your debt into a single and manageable payment period, allowing you to have more control of your finances and reduces the likelihood of incurring late payment fees.
Higher credit score
Getting a personal loan can affect your credit score and especially if you are late or default on the payment. Having low credit scores can affect your ability to get another loan or credit card and may even affect your job performance. By paying off your outstanding debts with the DCP, it can help to reduce the impact on your credit score and improve your overall score within a short span of time.
Disadvantages of debt consolidation
Like any financial loan, DCP requires discipline and commitment to paying off your debt. While it may help to overcome your financial woes, there are some disadvantages of debt consolidation plans:
Possibility of taking longer to repay debt
Many providers charge an early repayment or termination fee if you opt to repay your loan before the end of the loan tenure. This is often a percentage of the repayment amount. Hence even if you have the available funds, you have to consider the additional fee incurred to repay your debt in advance.
May end up paying more
While it varies between providers, some DCP have upfront costs such as registration fees, closing costs and annual fees. Hence it is important to clarify on any additional fees, including late payments, before signing up for the DCP. Often the longer your loan tenure, the lower your monthly repayment. However, depending on the severity of your debt, you may be quoted a higher interest rate initially. Hence in the long run, you could end up paying more due to the interest rate.
Possibility of falling back into poor spending habits
Some people find themselves constantly in debt due to poor financial management such as habitual gambling and compulsive buying. While the DCP can help in the short term, it may not be the best solution in the long run. Some may be tempted to borrow more and this may cause them to fall into greater debt in the future.
Editor’s Note:
While every precaution has been made to ensure the accuracy and fairness of this listing, we acknowledge that they may be inaccuracies. Therefore, we urge you to contact the service provider above for the correct information and/or contact us with the correct information.
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