A new scheme to help borrowers reduce their debt burden starts next Monday.
The debt consolidation plan, as it is called, targets people who will be affected by upcoming changes in borrowing limits.
Under these rules, starting in June, unsecured debts cannot exceed 18 times a borrower’s monthly pay. In June 2019, that drops to 12 times – half the limit of the 24 times of monthly income now. Unsecured debts are those with no collateral, such as red ink run up on a credit card, personal loans or overdrafts.
The rule change will likely catch out many people.
A Monetary Authority of Singapore spokesman said: “As of November 2016, about 4 per cent of unsecured credit borrowers in Singapore had outstanding interest-bearing unsecu…
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