Digibank GXS launches personal credit product with interest rates from 3.8%
DIGITAL banking player GXS Bank on Tuesday (Apr 25) announced its first unsecured lending product, GXS FlexiLoan, with annual interest rates starting from 3.8 per cent, or an effective interest rate from 7.15 per cent.
The product combines features of a credit line and a personal instalment loan, where customers can make multiple loan drawdowns without underwriting each time.
They can choose to borrow sums as little as S$200, with tenures as short as two months.
The flexible tenure caters to “underserved consumers such as gig workers, entrepreneurs and early-jobbers,” the bank said, citing its survey where one in two respondents said they would prefer to take up loans with a tenure of under 12 months.
Late interest is charged at a default rate of 18 per cent per annum. There are no processing fees or early repayment fees.
The GXS FlexiLoan is available to all individuals who meet the regulatory requirements in Singapore, including being aged between 21 and 65 and having a minimum annual income of S$20,000. They do not have to be GXS deposit account holders.
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“Even with the extensive loan products currently available in the market, there are still individuals that are thinly served by banks and who feel constricted and burdened by the requirements or construct of these products,” said Jenn Ong, head of credit products at GXS.
“When faced with such hurdles, they may look for quick fixes which may not be financially prudent for them, such as taking on alternative loans with high interest rates or hidden fees that may snowball.
“Taking on a loan may also not be feasible for those who may have irregular income and are looking for flexibility in repayments.”
This is the second product to be launched by GXS Bank, which is a joint venture of ride-hailing company Grab and telco Singtel.
In August 2022, the bank launched its savings account on an invite-only basis, with an interest rate of 3.48 per cent per annum for those who deposit funds in “saving pockets”, a feature within the account where users can save for certain goals.
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