Bad debt collection practices soon to be curbed in Singapore
Singapore. The Parliament passed the Debt Collection bill on Tuesday, which aims to manage debt collection activities all over the country. This comes after a rise in complaints from Singaporeans.
The new law will set standards for debt collection companies, errant businesses, and debt collectors.
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Minister of State for Home Affairs Sun Xueling, who is also the author of the bill, stated that police reports concerning debt collectors and businesses have remained high, averaging 367 annually from 2018 to 2021.
“The reports were mainly against debt collection tactics aimed at pressuring debtors into payment by causing public embarrassment and inconvenience to them,” she said.
Despite this, Ms Sun noted that debt collection is still a legitimate activity that is needed to fulfill one’s obligations. However, businesses and people should not experience debt collection methods that affect their safety and security.
Ms Sun also added that the new law is set to “contain clear rules of what is and what is not allowable, in order to provide debt collectors with a clear framework within which to operate, and I think as well as to educate debtors on their rights.”
Some practices that would be banned include the use of display of threatening behaviour and words, as well as the display of notices about debts outside the property of the debtor.
“The debt collection regulations will also prohibit debt collectors from continuing to collect debt from a debtor if the debtor has informed the debt collection business or collector that the debt is in
dispute, or that the debtor has initiated a process to settle the debt through other means (such as mediation or court proceedings),” added Ms. Sun.
Under the new law, debt collectors will be assessed by the police concerning their past offences under laws like the Organised Crime Act and the Vandalism Act. Other “matter or evidence that may be relevant” will also be considered.
For ex-offenders, licensing officers will be tasked to assess “circumstances on a case-by-case basis.”
An effort to improve public education and awareness to reduce unnecessary harassment and intimidation will also be enacted to inspire people to report unethical debt collection practices.
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