One Borrower’s Story: On the Road to Becoming Debt Free

A lot of people can easily relate to Ms. A’s story.  It started with a seemingly innocent purchase: she wanted an iPhone.  She had some money saved up but did not want to spend all of it on a smartphone. She had been a borrower before and did not have any problems paying off the debt.

Ms. A then decided to borrow S$500 from a loan shark that was constantly spamming her hand phone.

Ms. A was very happy with her rose gold iPhone, but what she did not expect were the harassing phone calls she would soon be receiving on it.  When she got the loan with weekly interest of $150, she thought to herself, “It really didn’t seem like much.  I thought that I could pay it with no problems at all.”

…I felt hopeless.”

But Ms. A was wrong.  She found it difficult to pay the escalating payments and soon she found herself owing money to five different loan sharks and two licensed moneylenders.

Loan sharks and debt collectors where constantly harassing her.  Ms. A would wake up in the middle of the night to the sound of her iPhone ringing and when answered, she would almost always hear threats and vulgar words.

“One even suggested that I start working on Geylang (Singapore’s red light district) just so I could pay.”

Ms. A fell into depression.  She was too embarrassed to turn to her parents for money.  Then the harassing phone calls became more and more frequent, with some collectors even calling her office.  Somehow, they also got her parents’ number and called them as well.

“My father did not speak with me after the many calls he got from the debt collectors.  I was really angry and sad at the same time, but I felt hopeless.”

Just after she bought it, Ms. A would look at her iPhone with pride and delight, now she hated it and blamed it for all the stress that she was going through.  Ms. A now had a debt of more than $4,000, eight times the amount she originally borrowed.

Help in Sight

Fortunately, she confided in a coworker whom she knew also had a similar problem.  The coworker directed her to the Association of Muslim Professionals’ Debt Advisory Center where she learned more about her rights as debtor.

Ms. A recounts, “They told me to stop paying the loan sharks and just focus on paying the licensed moneylenders. They even helped me come up with a monthly budget so that I could easily adhere to the debt management plan that they helped me to prepare.”

Ms. A also attended the support group sessions that were offered by the centre.  She found other people like her and was surprised to find out that she was not alone in feeling stressed and ashamed of her situation.

“I was listening to one girl who talked about committing suicide because of the harassment she received, and I remember thinking to myself that I should also share my experience because killing myself definitely crossed my mind several times.”

Today, Ms. A is slowly but surely getting her finances in order. She has already paid off one of the licensed moneylenders and is on her way to completing her repayment to the second moneylender.

Looking to borrow in Singapore? Here’s what you should do:

1. Do not pay the unlicensed moneylenders (“ah longs”), instead focus on repaying the licensed lenders. File a police report for the unlicensed lenders.

2. List all of your income and expenses for the month to determine how much money you have left at the end of the month and then negotiate for an easier repayment plan with your licensed moneylender(s).

3. Do not keep the problem to yourself. Even if your friends cannot lend you the money you need to pay off your debt, they may be able to help you deal with the situation, perhaps by offering advice on where to go and what to do.

Your coworkers may also be able to help fend off the harassing phone calls by telling the collectors that you are no longer employed in the company or have moved to another department.

4. Seek help from charities and professional organizations such as:

Do you need to know how to file a complaint against a licensed or unlicensed moneylender? Read our helpful guides on how to file a complaint against licensed and unlicensed moneylenders.