1 Fullerton Credit Pte Ltd is a licensed moneylender (License No. 100/2023) listed in the Registry of Moneylenders, under the Ministry of Law in Singapore.

How to Improve Bad Credit to Get a Personal Loan in Singapore

Stressed young woman trying to find money to pay credit card debt

At times of personal emergencies and economic crises, personal loans become the last hope for many Singaporeans. Personal loans provide them with the cash they badly need. But their ability to apply for a personal loan in Singapore relies heavily on credit scores. Those with bad credit scores have a lower chance of getting their personal loan applications approved.

Meanwhile, having a good score allows applicants to get the amount they need. Read this article to know how to recover from bad credit scores and how you can increase the amount of money you take through a personal loan.

Why Does a Good Credit Score Matter?

In the world of loan and finances, trust is the most important thing. There must be trust between clients and the financial institutions so that they can enter into fair and just contracts and agreements. In the case of a loan, licensed moneylenders must trust the borrower that he will pay back the money he borrowed. To build this trust, the borrower must prove that he has a good history of paying back his loan in the past and that he is financially able to pay back the amount he is asking.

One effective proof of being a good borrower is the credit score. Credit score refers to a number that rates the creditworthiness of an individual. This score is based mainly on the report or credit history submitted by the credit bureau of Singapore. To build a good score means that you must have borrowed money in the past, and you have successfully paid it back.

How to Improve a Bad Credit Score? 

There are two main reasons why Singaporeans have bad credit scores. First, they have not made any prior loans which mean that they are yet to prove their ability to pay back the money they borrowed. Second, they have made a loan in the past but failed to pay it on time or pay it at all. In both instances, these individuals have bad credit because they have not proven that they are capable of borrowing money and paying these loans back.

If you are wondering if people can improve their score, the short answer is yes. But, improving bad credit takes years. It is safe to say that you will be able to “repair the damage” in 1 to 2 years. This improvement also depends on the current financial situation of a person.

Improving a  bad score takes months or years because people must apply for a personal loan in Singapore, and they must pay back this loan. The more loan a person successfully pays back, the better his score becomes. This is the reason why even young individuals are encouraged to try submitting a loan application. At a young age, they can get to build a good credit rating.

Effective Ways to Improve your Credit Score

Aside from making a loan application, there are many other ways where you can improve your credit rating. Here are some of the few ways to turn your bad credit score into a good one. Follow them, and you can be sure that you will be successful in applying for a personal loan in Singapore in the future.

1. Repay loans on time. Never miss a repayment deadline. Aside from avoiding late fees or any additional fees paying on time shows your commitment to the promise you made to your bank. It is important to remember that by the time your bank or licensed moneylender has sent you a second or third letter of late payment reminder, your credit score has dropped.

2. Avoid making multiple loan enquiries within a short span of time. People who apply for multiple credits in a short period of time send the wrong message to licensed moneylenders. It shows that they are facing financial difficulty, which would often lead to their failure to repay a loan. A client who made four or five loan applications in a single month would look desperate in the eyes of financial institutions.

If you truly need to make several loan applications, the technique here is to spread out your loan applications in several months. You have to read and research first before making loan enquiries. In doing so, you will only send a few loan enquiries and loan applications.

3. Limit number of open credit facilities. As a rule of thumb, you must not have more than three loan facilities. This includes credit cards or personal loans. Having so many open loan facilities can be expensive as they often charge annual fees. It is best to build a good relationship with your trusted financial institutions and do your transactions with them.

4. Meet short-term loan repayments to repair damaged credit. One quick way to recover from bad credit is to settle any short-term or small loans. Doing so sends a message to the credit bureau that you are becoming responsible with your finances.

What Are the Factors That Affect Your Credit Scores

Credit rating, pen and glasses on a blue table

If you are wondering what factors are used by the bureau to check your credit rating, read below. To know more about how the credit score is computed by the Credit Bureau, check the information here.

1. Recent Credit. This refers to the loans you have made in the past few months. Too many recent credits is a red flag to the bureau.

2. Utilization pattern. This is the amount of credit owed or used on accounts by the borrowers.

3. Account Delinquency Data. This refers to the late payments of your loan account. Having more delinquencies or late payments results in bad credit.

4. Credit Account History. This refers to all the credit transactions you have made in your life. This is also known as credit history.

5. Available Credit. This refers to the number of credit accounts that you can still open.

6. Enquiry Activity. This refers to the total number of credit applications you have made.

If you wish to know more about how your score is categorized, here is the Credit Score Risk Grades in Singapore by Credit Bureau Singapore.


Score Ranger

Risk Grade

Probability of Default

Min Max
1911-2000 AA 0.00% 0.27%
1844-1910 BB 0.27% 0.67%
1825-1843 CC 0.67% 0.88%
1813-1824 DD 0.88% 1.03%
1782-1812 EE 1.03% 1.58%
1755-1781 FF 1.58% 2.28%
1724-1754 GG 2.28% 3.46%
1000-1723 HH 3.46% 100%

Where to Apply for a Loan?

A lot of people are interested in where to get a personal loan. This is the reason why we often see online inquiries like “personal loans Singapore” or “personal loan Singapore.” People in Singapore are in a bid to get loans with low interest rates because low interest rates mean a lower amount to repay. The best way to get the best deal is to compare loan rates through loan comparison sites.

You can start through looking at 1 Fullerton Credit who have provided excellent service to their clients in the past. You can look into a personal loan and other loan deals offered. We are a licensed moneylender who has given a lot of personal loans in Singapore. 1 Fullerton Credit Pte Ltd can guide everyone on how to navigate this loan application process.

Remember that having a good credit score can increase the chance of you getting the best loan deals. Just communicate with a trusted financial institution like 1 Fullerton Credit Pte Ltd so you will get the best deal for you. A good rating can get you more money when your loan and can get you more deal options to choose from.

If you wish to find a Singapore personal loan with good interest rates, it is ideal to start improving your credit score. A good credit rating allows you to choose from a variety of financial institutions with competitive interest rates. In contrast, a bad rating will limit you in terms of the money you can borrow and the financial institution you can choose from.

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