Since Singapore scrapped VTLs and opened the floodgates to travel, Singaporeans have been flocking abroad after two years without a vacation.

And by some strange coincidence, there has also been an increase in searches for personal loans, although we really hope people don’t take out loans to go on vacation.

If you’ve researched a personal loan yourself, this article will walk you through the factors you need to consider, such as interest rates and repayments.

Warning: Not to be your mother, but remember that you should “under no circumstances” take out personal loans for non-essential expenses like going on vacation or buying new shoes.

Personal loan interest rates are quite high and can spiral out of control if you don’t repay them on time. And high-interest debt is what makes a lot of people go bankrupt. Personal loans should therefore only be used for valid reasons such as medical emergencies or credit card consolidation.

HSBC personal loan is one of the most sought after personal loans after local banks such as DBS and POSB personal loan, OCBC personal loan and UOB personal loan. Let’s look at how the HSBC personal loan compares to the three local banks”.

HSBC Personal Loan Application Criteria

The HSBC Personal Loan Plan is called the “HSBC Personal Line of Credit (PLOC) Installment Plan”.

The minimum loan amount is $1,000 and you can choose between a loan term of one to seven years.

For those earning less than $119,999 per year, you could potentially borrow up to 4 times your monthly salary, although of course you should avoid borrowing more than necessary.

The HSBC PLOC personal loan application criteria are as follows:

  • Between 21 and 65 years old
  • Citizens of Singapore and PR: annual income of SGD 30,000 for employees or SGD 40,000 for self-employed or commission-based
  • Foreigners: annual income of SGD 40,000 and employment card valid for at least 6 months

HSBC Personal Loan Application and Approval Time

You can apply online on the HSBC website with the following supporting documents:

  • Letter of instruction completed and signed
  • NRIC or Passport
  • Notice of assessment and CPF statement (via Myinfo, Singpass connection required)
  • Computerized payslips for the last three months (for employees with a monthly income greater than $6,000)
  • Employment Pass (foreigners only)

If you are an existing HSBC customer, you do not need to follow the above procedure. You can simply apply through your online bank account.

You can expect to receive the approval letter from HSBC within five working days of your request.

ALSO READ: Best Personal Loans in Singapore with Lowest Interest Rates (2021)

HSBC Personal Loan Interest Rates (2022)

HSBC is currently offering promotional interest rates of 3.2% to 8.2% per annum, which equates to an Effective Interest Rate (EIR) of 6% to 14%, when all fees and charges are taken into account. The promotion ended on May 4, 2022.

You also have to pay a $60 annual fee (waived for Premier customers).

These interest rates are very competitive with what POSB/DBS, UOB and OCBC currently charge, but be aware that what you end up paying varies depending on the amount and term of your loan.

The easiest solution is to use MoneySmart’s Personal Loan Comparison Tool to compare loan interest rates charged by different banks for your desired loan amount and term.

HSBC Personal Loan Interest Rates vs DBS, POSB, OCBC, UOB

Let’s say you want to borrow $10,000 and pay it back over three years.

Here’s how the HSBC loan would stack up against the three local banks.








Interest rate RIE Monthly payment Total amount to pay
HSBC 3.2% 6 percent $304 $10,960
DBS/POSB 3.88% 7.9% $310 $11,164
OCBC 5.43% 11.47% $323 $11,629
UOB 3.4% 6.42% $306 $11,020

As you can see, for this particular loan, HSBC actually charges a lot less than any of the three local banks.

Using MoneySmart’s personal loan comparison tool, you can calculate your interest rate as well as how much you would pay each month for your own situation.

HSBC Personal Loan Promotions

HSBC offers the following personal loan promotions:

  • 1% processing fee waived for applications received (completed May 4, 2022) and approved by May 31, 2022. You can get up to $88 back from your processing fee.
  • $100 rebate when you apply for a first HSBC PLOC (ended May 4, 2022)
  • Cashback of 0.5% of loan amount (capped at $1,000) for online applications (ended May 4, 2022) with a minimum loan amount of $10,000 and a term of at least two years .

To benefit from the above promotions, you must agree to receive marketing materials from HSBC.

HSBC Personal Loan Calculator

To determine how much you will pay in interest and monthly payments, you can use HSBC’s Personal Loan Calculator.

Here are the amounts to watch out for:

  • Monthly repayments – These are the monthly installments you have to pay each month.
  • Total Repayable Amount – Subtract the amount you borrow from this figure and you will get the total cost of the interest payments you will make over the life of the loan.
  • Applied/Effective Interest Rate – This is the “real” annual interest rate you will pay when all fees and charges are taken into account.

How to pay an HSBC personal loan monthly online

You can repay your loan by transferring money to your PLOC account through online banking.

Simply log into your online banking account (it doesn’t have to be an HSBC account) and transfer money to HSBC using the reference information on your monthly statement.

Make sure you pay the installments on time or you’ll be slapped with a $75 late fee.

How to close an HSBC personal loan

If you hit Toto or manage to save enough money, you can prepay your loan, but you will have to pay a prepayment fee (usually 2.5% of the repayment amount, but you should check your approval letter to be sure) . You must also pay a $40 administration fee if you close your account within the first 6 months of account opening.

To prepay your loan, you must give the bank 30 days notice. They will then send you a reimbursement letter stating the total amount you need to pay and the deadline.

When you have fully repaid your loan, your account will be closed automatically.

READ ALSO: Can I take out a personal loan? Answers to the 7 most frequently asked questions

HSCB Personal Loan vs HSBC Personal Line of Credit Balance Transfer

A personal loan should not be confused with a credit balance transfer.

Credit balance transfers are for people who already have personal loans or credit card debt. They allow you to transfer your existing debt to a single HSBC account, which makes sense if HSBC offers a more attractive interest rate than your other creditors.

A personal loan like HSBC PLOC, on the other hand, is a new loan, which means the bank will lend you a new disbursement of money to add to whatever you may already owe to other creditors.

Be careful with personal loans

I’ve said it once and I’ll say it again: you should only take out personal loans for the unavoidable, like emergencies and necessities to keep you alive. The purpose of the personal loan is to save you from having to resort to credit card debt, which is even more interest-bearing, when you really have no other options.

For everything else, it’s not worth it, man. If you feel like you really need to go on vacation now that the borders are open but you don’t have the money, eat instant noodles for a few months or do a side gig until you’ve saved enough. , rather than getting into debt.

This article was first published in MoneySmart.