14 financial institutions in Singapore to participate in debt consolidation plan

FOURTEEN financial institutions in Singapore will participate in a debt consolidation plan this month, said the Association of Banks in Singapore (ABS) on Tuesday.

The debt consolidation plan will allow eligible customers to consolidate their existing unsecured credit balances across financial institutions with just one participating financial institution. Such debt will include credit card debt, personal loans and overdrafts.

The plan is a new repayment scheme that aims to help borrowers to reduce their debts over time, and comes ahead of an industry-wide borrowing limit. This will stand at 18 times of monthly income from June 2017 - down from 24 months of monthly income - and then, to 12 times of monthly income by June 2019.

The debt consolidation plan will come into effect from Jan 23, 2017.