Blogpost

Should you invest in cryptocurrency?

The risks and benefits to know before you invest in crypto

Cryptocurrency is all the rage these days, with terms like crypto millionaires and NFTs (non-fungible tokens) on everyone’s lips. Since most people like quick cash, investing in crypto is something we might have considered.

In this article, we explain what exactly Crypto is, its risks and benefits, and whether you should invest in it. If you are looking to make some quick cash to either pay loans or increase your net worth, crypto could be an option.

What is Cryptocurrency?

A cryptocurrency is a form of payment that can be exchanged online for goods and services. The most famous of them is Bitcoin, which was invented in 2009 by an anonymous person. It works via blockchain technology, which transmits data and records transactions. Also, cryptocurrencies are decentralised, which means they are outside the authority of governments and banks.

Many companies, including a few Singaporean ones such as Crypto.com and StraitsX, issue their own cryptocurrency, also called tokens, which can be used to buy goods or services that the said company provides. There are currently more than 10,000 different cryptocurrencies being traded publicly. All cryptocurrencies also have the same value in every country and there are no exchange rates.

There are three main ways to hold cryptocurrencies. All involve having a “wallet”, which is an account that holds your crypto. Firstly, you can hold them on exchanges such as Binance or Coinbase. On such platforms, you will be issued a “hosted wallet”, so-called because these platforms hold the wallet. The second way is to have a “non-custodial” wallet, which means you have full control over your crypto. The downside is that if you lose your password, the wallet is gone forever. Lastly, the “hardware” wallet. Unlike the previous two options, a hardware wallet is a physical device the size of a thumb drive that stores your crypto. The upside is that you cannot be hacked since this is offline, with the downside being an inconvenience.

So, how do you make money? Much like stocks, the value of your portfolio increases when the price of the crypto token/s you hold rises, and vice versa. In other words, you make money when you sell the crypto tokens at a profit.

Risks

As with all investments, there are risks. Crypto is known to be more volatile than stocks or gold, which is why it would be good to keep a healthy capital at bay so that you may buy more when it drops and sell when it’s at a higher price.

There is no sure-win crypto token. Although there are many established tokens with reputable companies behind them, the market is very competitive, with many tokens getting unlisted every few months. If you happen to hold such tokens, you lose all their value.

Another risk is vulnerability to hacks and criminal activities. For example, if your crypto is stored on an exchange, hackers can hack into your account and transfer your assets to their accounts. You may or may not be able to recover your crypto tokens — some are traceable while others are untraceable.

Lastly, there are scams. These tokens are often either hyped-up to offer extremely good services, such as giving you a percentage of their earnings, or entice you to invest by a tactic called “pump and dump”. “Pump and dump” happens when a token suddenly rises many times in value, attracting you to buy at an already high price. Once enough people buy at a said high price, the manipulators will “dump” the price by selling all their tokens, leaving you at a great loss. You may end up needing to pay loans that you have borrowed to buy such tokens looking for quick cash.

Benefits

Many see cryptocurrencies as the currency of the future. We may end up using coins like Ethereum or Bitcoin to pay our monthly bills, or to procure certain products or services. Hence, buying these coins may be considered a long-term investment.

There is indeed such a thing as making quick cash. In May 2020, Bitcoin’s price was about USD 9,500. In May 2022, it was hovering around the USD 31,000 mark, though, in July 2022, it went down to around USD 19,000. Many coins have grown exponentially over just a few days, such as DogeCoin, which often pumps dramatically due to a tweet from billionaire and Dogecoin fan Elon Musk.

The technology behind crypto, blockchain, is also why many people believe in digital currency. This technology is touted to be able to revolutionise industries from shipping to gaming. Having many believers and potential, many investors believe that cryptocurrency is not a fad and will only become more important as time goes on.

Lastly, some cryptocurrencies have high liquidity. This means that you can sell or buy them very quickly at market price. For example, if you need money to pay loans, you can simply liquidate your tokens for fiat, which is a term for real-world money.

Should You Invest In Crypto?

It depends if it is within your means. It is important to remember to never invest more than what you could comfortably afford to lose.

Investing in crypto can be an option to diversify your portfolio, which is always a good thing. This is especially true if you believe in the technology behind the tokens that you buy, and also that crypto usage will become more widespread as time goes by. However, do take note that the MAS discourages the general public from engaging in cryptocurrency trading as it is “highly risky”.

Bent on snagging some tokens right now but lack the funds? You might want to consider borrowing a relatively small sum from Galaxy Credit, a 24-hour money lender in Singapore, anytime, any day. As it stands, nobody said you have to invest a tonne of money into cryptocurrency for potentially big wins!

Disclaimer

While we try to provide the most accurate information on this website, it may not reflect the most current developments. The information on this website may be changed without notice and is not guaranteed to be complete, correct, or up-to-date. All information provided is for informational purposes only and shall not be relied upon as professional advice. We shall not be liable for any loss or damage resulting from the use of this website.

Table of Contents

Related Posts

When you are looking to borrow money in Singapore, besides turning to banks, credit cards, or family and friends, a licensed moneylender is also a popular option. However, it can be daunting for first-time money borrowers who may not know how to borrow safely from a licensed moneylender in Singapore. Here are some useful tips to help you get started.

Tip 1: Find a licensed moneylender in Singapore

Before approaching a moneylender, the most important thing you have to do is make sure you are dealing with a licensed moneylender. The way to determine that is by browsing a list of licensed moneylenders on the Ministry of Law’s website and verifying your choice. . Registered moneylenders in Singapore have to abide by regulations set forth by the Ministry of Law that protects the money borrower. If you are unsure, you can always refer to the FAQ list or contact them for inquiries.

Tip 2: Identify the right loans that match your budget

When you apply for a loan, always determine the purpose and need for it. Make a plan of how many loans you need and when you need them. Personal loans are a flexible and accessible option for people looking to fund various purposes such as paying off high-interest credit card bills, medical expenses, home renovations, and so on. Identifying the right loans can help you stay objective and use them wisely to pay off your existing debts or to bridge a temporary financial gap.

On top of that, you will need to calculate your monthly budget to see what you can actually afford. While personal loans are packaged with low-interest rates, your budget will help determine how many loans you can borrow within your means and if you can repay them on time. The smaller your loan and the shorter your repayment period, the less interest you have to pay. Understanding this simple tip can help you avoid taking on a larger loan and staying in debt for a longer period.

Tip 3: What a licensed moneylender must inform you before granting a loan

Before approving loans, the moneylender is required to inform the borrower in writing, the full terms of the loan, including:

  • Nominal interest rates
  • Late interest charges
  • Other permitted fees
  • Instalment details, especially in cases where there is a fixed repayment period agreement between both parties, also known as a term loan

Tip 4: Choose a licensed moneylender you can trust

Now that you know the types of loans you need and the budget you have, it is time to research quotes from different moneylenders. One thing you should look out for when discussing loan terms is the interest rate*. Under the Moneylenders Act, the maximum interest rate that a licensed moneylender in Singapore can charge is 4% per month based on the borrowed amount or late interest from a late payment.

*The interest rate should be computed based on the monthly outstanding balance of the principal remaining after deducting the payments made.

For instance, if your loan amount is $10,000 and you have already paid $5,000, then the 4% interest rate should only be computed for the remaining $5,000.

A licensed moneylender may also impose other fees such as latefees or legal costs incurred to recover loans if the borrower fails to make payment.

Do look out for some shady practices that a licensed moneylender in Singapore is not allowed to engage in:

  • Using abusive or threatening language
  • Fishing for your SingPass ID or password
  • Failing to return your important personal identification documents such as NRIC and passport
  • Asking you to sign a blank or incomplete contract for the loan
  • Approving your loan without explaining the terms in detail
  • Failing to provide you with a copy of your loan contract
  • Soliciting for loans via text messages and phone calls

Galaxy Credit and Investments Pte Ltd is a licensed moneylender in Ang Mo Kio that provides a one-stop moneylending solution for our customers. We understand your financial needs and are committed to providing excellent loan services at the best and most affordable rates.

To apply for a loan with us, you should be:

  • At least 18 years old and have a stable source of income
  • A Singaporean, PR, EP, or S-Pass Holder
  • Able to provide proof of identity (e.g. Singapore IC or passport)
  • Able to provide proof of income (e.g. payslips, monthly bank or CPF statements, latest IRAS Notice of Assessment)
  • Proof of residential address (e.g. billing proof or bank statement (for foreigners)

To find out more about a safe and reliable way to borrow money in Singapore, contact our team of friendly and experienced loan officers today.

 

Most adults in Singapore have heard of a credit report even if they have not personally obtained one. It is almost always the first document that any lender, from major banks to licensed money lenders, will refer to when they are considering a loan application.

What info does a credit report contain?

A credit report in Singapore is divided into ten sections.

Section 1: Data Provided and Summary

This is where you will find personal details such as your full name, NRIC, date of birth, and postal code.

It also lists basic financial credit information, including the date of your first credit record on file, the number of credit lines in your name, the number of defaults and bankruptcies, your secured credit limit and unsecured credit limit, etc

Section 2: Personal Details

This is where you’ll find other additional details such as gender, nationality, marital status, and address

Section 3: Additional Names and Addresses

You’ll be able to see all the addresses and names associated with or ever have been used by you for your NRIC, bank accounts, credit cards, cheques, etc.

Section 4: Account Status History

This section details the types of credit products you have (e.g. home loans, credit cards, personal loans), the grantor banks, dates of opening and closing the account, overdue balances as well as details of how prompt you’ve been at making full payment for each account for the last twelve cycles.

Section 5: Previous Enquiries

This section shows a record of all recent requests for your credit report in Singapore, either by yourself or banks and money lenders.

Section 6: Bureau Score

This section uses all the information from Sections 1 through 5 to come up with the individual’s credit score, risk grade, risk grade description, and the likelihood of default.

Section 7: Narratives

Any other important information about your account(s) will be illustrated here. For example, if you’d applied for a mortgage deferment due to the pandemic, the date and type of request would be narrated in this section.

Section 8: Adverse

Any adverse information regarding the individual would be written here.

Section 9: Aggregated Outstanding Balances

This section shows an overview of all your financial products’ secured balances, interest-bearing unsecured balances, non-interest-bearing unsecured balances, and exempted unsecured balances.

Section 10: Aggregated Monthly Instalment

​​The monthly instalments show the amounts for each credit facility for the previous month and the total amounts for the previous five months.

Who can obtain a credit report?

Any legal resident of Singapore, including foreigners, can apply for a copy of their credit report.

Apart from individuals, banks and financial institutions can obtain your credit report for credit assessment purposes. Some licensed money lenders will also look at your CBS credit report when assessing your loan application.

Privacy safeguards regarding credit reports

All data in a credit report is obtained from the Credit Bureau (Singapore), also known as CBS. The company practices the highest level of information safety and security and there has never been a breach of CBS data.

What if there are errors in your credit report?

Your credit report may contain errors and such mistakes can affect your personal loan interest rates. If you spot an error, contact the bureau immediately. You will have to provide evidence to dispute any data on the report.

Why should you consider getting your credit report?

Both individuals and business owners can benefit from knowing their credit status.

Accelerated loan approval

· Business owners: A credit report is almost essential for current and aspiring business owners. Whether you are setting up or expanding a business, you will need capital. A good credit report will qualify you for a legal loan in Singapore faster and help you make the best use of opportunities as they present themselves.

· Individuals: Whether it is a medical emergency, sudden vehicle breakdown, or legal fees, good credit gives you the money you need quickly. You also can avoid such situations by learning how to set personal financial goals.

Lower interest rates

A good credit score informs lenders that you are a reliable borrower. They will offer you lower interest rates and may even waive certain fees and penalties. Hence, the better your score, the less you will waste on additional expenses.

· Business owners: Lower business loan interest rates to set up or expand operations.

· Individuals: Lower personal loan interest rates to be used for a variety of purposes.

Higher credit limit

· Business owners: Lenders appreciate individuals and businesses with good credit because they regard them as safe investments. They will extend higher credit limits, which means that you have access to more funds if you want to expand, or if you need to weather a slow business period.

· Individuals: Expenses such as weddings, school fees, and renovation can be huge. A high credit limit gives you all if not most of the money you need instantly.

Where to get your credit report in Singapore

Credit reports in Singapore are issued by CBS or Credit Bureau (Singapore). CBS is a joint venture between the Association of Banks in Singapore (ABS) and financial services company Infocredit Holdings Pte Ltd.

Where does CBS get its information?

ABS members share their credit information with CBS. CBS then organises this diverse information by the individual and shares it in the form of a credit report when a valid request is made.

How to get your credit report

There are a few ways you can obtain your credit report:

Cost Eligibility
Free New credit facility applicants (within 30 calendar days from the date of approval or rejection letter)
Free First 2,500 customers to complete the free credit report by HSBC application form between 01 May 2022 and 30 April 2023, both dates inclusive
$6.42 (GST included) Anyone can purchase online via eNets or credit card

Bottom line

The CBS credit report only includes your records with major banks and other financial institutions in Singapore. To obtain your loans and repayment records with licensed money lenders in Singapore or check on your overall financial health, you can consider buying your credit report from the Moneylenders Credit Bureau.

A credit report may not be a huge part of your financial plans but it is a good-to-know when you find yourself in a situation where you need to apply for a personal or business loan. Reach out to us to find out more about any legal loan in Singapore that may be suitable for your needs.

Whether you’re living alone or with loved ones, the space we call home is sacred. It’s where we relax, play, rest, and form relationships outside of work.

Renovations are a great way of beautifying these spaces and increasing our quality of life. However, it can be expensive and we might have to consider taking out a loan. It is important to consider renovation loan interest rates when deciding on which option to take.

In this article, we compare renovation loan interest rates offered by banks with those offered by licensed moneylenders in Singapore.

Renovation Loan From Banks

In general, some banks charge monthly interest fees based on the outstanding balance, whereas others base it on the total amount borrowed. Also, tenures (amount of time you’re given to repay a loan) given by banks are normally at a maximum of only 5 years, and the maximum renovation loan amount is typically 6 times your monthly wages at a cap of $30,000.

To qualify for a renovation loan from banks, you are usually required to

  1. Own a property.
  2. Be a Singaporean Citizen or PR.
  3. Fulfil minimum income requirement as determined by each bank.
  4. Be in a certain age range.
  5. Have an acceptable credit score.

Other than these criteria, one other important limitation is that banks normally determine what the loan can be used for. For instance, most banks do not allow the loan to be used for purchasing furniture.

Renovation Loan Interest Rates For Banks

Here are five renovation loan interest rates from popular banks.

1. POSB Renovation Loan

One of the more popular renovation loans from banks, its selling point is its lower-income requirement of $24,000 per annum.

The interest rate starts from 3.88% p.a. for the Green Renovation Loan, up to 4.18% p.a for a standard renovation loan.

2. OCBC Renovation Loan

The OCBC renovation loan boasts a simple online process, with a fast loan approval within 60 seconds and loan disbursements within 5 working days.

The interest rate is at 4.18% p.a. with flexible repayment of up to five years.

OCBC also offers the Eco Care Renovation Loan. This requires your home to be energy efficient as verified by the Tropical Home Energy Efficiency Assessment (THEEA). If you qualify for this loan, you stand to enjoy a lower interest rate of 3.98% p.a., along with other benefits.

3. Maybank Renovation Loan

Maybank’s interest rate is much lower if you are already an existing Home Loan customer.

The interest rate for existing Home Loan customers is at 2.88% p.a.

The interest rate for new customers is at 4.10% p.a.

The application process is fully online and can be auto-filled using your Singpass account, which makes for a seamless process.

4. DBS Renovation Loan

The terms of DBS’s renovation loan are quite similar to POSB.

The interest rate is at 4.18% p.a.

However, if you fulfil the requirements for their DBS Green Renovation Loan (POSB also offers a similar one), the interest rate can go as low as 3.88% p.a.

5. RHB Renovation Loan

RHB’s interest rates are higher than other banks. However, it offers a unique refurbishing loan that most other banks do not.

The interest rate is at 5.80% p.a.

Here’s a table summary of the bank interest rates for renovation loans (p.a.):

POSB OCBC Maybank DBS RHB
4.18%

3.88%

(Green Renovation Loan)

4.18%

3.98%

(Eco Care Renovation Loan)

2.88%

(Existing Home Loan Customers)

4.10%

(New Customers)

4.18%

3.88%

(Green Renovation Loan)

5.80%

Renovation Loan From Licensed Moneylenders

A more flexible renovation loan option is using licensed moneylenders. A reputable moneylender goes a long way in ensuring you are borrowing safely and legally. These loans are generally kinder in terms of requirements, which may sometimes be a hindrance when borrowing from banks.

In addition, renovation loans from licensed moneylenders can be used for a myriad of home improvement works, including plumbing, electrical works, painting, and the purchase of furniture.

Renovation Loan Interest Rates for Licensed Moneylenders

Besides having more flexible requirements, the renovation loan interest rates for licensed moneylenders can be higher than banks, but with equally, if not more flexible repayment terms. Galaxy Credit is one such example. Registered with the Ministry of Law, they provide the best loan deals for customers along with simple, fast approvals.

Most licensed moneylenders offer interest rates of up to 4.0% per month, but Galaxy Credit’s renovation loan boasts a much lower interest rate, starting from 2.27% flat interest per month because the firm understands just how expensive home renovations can get.

With transparent service and professional customer support in mind, you will be assured of a customised loan package that you can channel towards building your ideal home. Talk to a loan expert about your borrowing options today.