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MAS To Phase In New Limits On Unsecured Credit

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The Monetary Authority of Singapore (MAS) will phase in new limits on credit card debt and other unsecured credit facilities* over four years to give borrowers additional time to reduce their debts.

After consulting with the Association of Banks in Singapore (ABS) and Credit Counselling Singapore (CCS) as well as taking public feedback into consideration, MAS has decided to give over-extended borrowers additional time to adjust to the new measures.

This new ruling is in light of the announcement made by MAS back in September 2013, whereby financial institutions are no longer allowed to grant further unsecured credit to someone whose outstanding unsecured debt is more than 12 times his monthly income for three consecutive months, this ruling was made to help individuals avoid accumulating excessive debt. To help over-extended borrowers, ABS and CCS will also be introducing a new debt repayment solution called the repayment assistance scheme.

The new limit on the total amount of credit card and other unsecured debt that can be held will be implemented as such:

– From 1 June 2015: Limit to be 24 times the monthly income.

– From 1 June 2017: Limit to be 18 times the monthly income.

– From 1 June 2019: Limit to be 12 times the monthly income.

For more information on the changes, go to

*Unsecured credit is borrowing that is not backed by any collateral.




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