Effective from 1st of October 2015, a licensed moneylender in Singapore can charge a maximum monthly interest rate of 4%. A maximum also of 4% in each month of late repayment. This is applicable to all types of loans and income.
The monthly interest rate must depend and based on the principal remaining. For example, the total principal loan is $12,000 and the repayment was $8,000, so the total principal remaining is $4,000. The monthly interest rate must be charged on $4,000 as the principal remaining.
The late interest rate must be based on the late monthly repayment. For example, if the total loan is $10,000, the current installment plan is $2,000 and the remaining is $8,000, the late interest rate will be charged on the current amount to be repaid which is $2,000.