Loan amount and interest rates

Besides licensed moneylenders, borrowers turn to banks, trade unions and illegal loan sharks. Here is how much they generally charge.

BANKS

Effective interest rates for personal loan: 12 per cent to 25 per cent per annum depending on income and loan tenure

Interest rates for housing loan: from 1.6 per cent per annum depending on loan tenure and type of loan

Minimum income: $20,000 per annum

Maximum amount that can be borrowed: up to four times the borrower's monthly income

UNIONS

Interest rates for personal loans: 4.25 per cent to 6 per cent per annum

Minimum income: no minimum income but must be member of union

Maximum amount that can be borrowed: two to eight times borrower's monthly salary or up to the value of the pledged collateral

LEGAL MONEYLENDERS

Interest rates for personal loans: 3.33 per cent per week to 20 per cent per month

Interest rate for housing loans: 4 per cent to 20 per cent per month, depending on the loan amount, repayment period and borrower's income

Minimum income: $1,000 a month

Maximum amount that can be borrowed: up to four times the borrower's monthly income

ILLEGAL MONEYLENDERS or LOAN SHARKS

Interest rates: Usually a flat 20 per cent per month, regardless of the type of loan

Minimum income: None. You need a guarantor who will pay up if you default.

Maximum amount that can be borrowed: Depends on how much you are trusted. Amounts start as small as $500 and can go up to thousands of dollars.

Source: Sunday Times, 9 May 2010