HSBC Debt Consolidation Plan Review

HSBC Debt Consolidation Plan Review

The lowest guaranteed debt consolidation loan rates available to borrowers in Singapore.

Good for

  • Borrowers in Singapore that require a debt consolidation loan to manage their personal debt

Bad for

  • Borrowers that are able to qualify for the lowest advertised interest rates from other lenders
  • Borrowers seeking debt consolidation plan with best cashback promotion

Editor's Rating

5.0/5.0

Singaporean's with high levels of personal debt may find it helpful to use a debt consolidation loan to manage their debt. In that sense, HSBC offers the best debt consolidation plan (DCP) in Singapore. The plan offers the lowest guaranteed interest rates of any loan duration, making it the most affordable option for borrowers.

Summary of HSBC's Debt Consolidation Loan
Lowest Guaranteed Interest Rates: 4% p.a. (1-7 years), 5.7% (8-10 years)
Loan tenure: 1 to 10 years
Processing Fee: S$88 or 1%, waived for online applications
Promotion: Processing fee waiver and S$100 cashback

Table of Contents

What Makes HSBC's Debt Consolidation Plans Stand Out to Borrowers

HSBC offers the lowest guaranteed flat and effective interest rates for debt consolidation loans in Singapore. This makes it the best, and the most affordable, debt consolidation plan for Singaporean borrowers. Additionally, it is currently offering S$100 cashback and waiving its application fee for online applicants.

Loan Duration (Years)Annualised Flat RateAnnualised Effective Rate
1 - 74.0%7.5%
8 - 105.7%10.0%

While other lenders advertise lower rates than HSBC, they use vague language (e.g. "as low as") that indicates that borrowers may actually be offered substantially higher rates. For this reason, HSBC stands out as one of a few lenders that provides details regarding its interest rates. Additionally, it offers the lowest rates among banks that guarantee interest rates published online.

This graph compares the effective interest rates of the best debt consolidation loan offer from each bank in Singapore

Who Can Apply: Eligibility Criteria

Consider this if you prefer a plan with the lowest interest rate and no processing fee

Balance to Income Ratio More than 12x monthly income
Early Repayment Fee 5% of redemption amount
Late Payment Fee S$75
Processing Fee S$88 or 1%, waived for online applications

Singaporean citizens and permanent residents with incomes of between S$30,000 and S$120,000 are eligible for HSBC's debt consolidation loan. Applicants must also have a balance to income (BTI) ratio of at least 12 times their monthly income. Additionally, individuals participating in the RAS scheme are eligible for HSBC's debt consolidation plan.

Other Charges and Fees

In addition to the 1% processing fee, which is waived for online applicants, HSBC charges an early settlement fee of 5% of the redemption amount. It also charges a late fee of S$75 and charges an overdue interest fee of 2.5% plus the prevailing interest on the overdue amount. The S$75 late fee is the lowest charged by DCP lenders. That being said, we strongly advise borrowers to make timely repayments in order to minimise the total cost of their loans.

FeeAmount
Processing Fee1% of approved loan amount (min. S$88), waived for online applications
Early Settlement Fee5% of redemption amount
Late FeeS$75
Overdue Interest Fee2.5% plus prevailing interest on overdue amount

How to Apply: Application Process

Applicants can apply online by filling out and submitting an application form. The form requires personal, employment, salary and financial information. Additionally, prospective borrowers must provide proof of identification, income, current debt and credit history. Applicants may also call HSBC or visit HSBC branches for assistance with the application.

For proof of income documents, salaried individuals must provide their most recent 3 months of computerised payslips, latest notice of assessment and latest month's computerised payslip or latest 6 months' CPF statements with latest month's computerised payslip/notice of assessment. Self-employed and commission-based employees must provide most recent 2 years' Notice of Assessment.

  • Photocopy NRIC (front & back)
  • Income documentation
  • Credit Bureau Report
  • Latest statements of applicant's existing unsecured credit facilities

Comments and Questions

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