Making it mandatory for foreign domestic workers (FDWs) to seek their employers' consent before they can borrow from licensed moneylenders may drive them to loan sharks.
For this reason, the Ministry of Manpower (MOM) does not plan to introduce measures for FDWs or moneylenders to obtain employers' permission before loans can be issued, said its Senior Parliamentary Secretary Low Yen Ling yesterday.
"We are concerned that, if and when we do so, it may well trigger the FDW towards taking more drastic actions such as...borrowing from unlicensed moneylenders," she said. "It's a very delicate balance."
Ms Low was responding to a suggestion by Mr Darryl David (Ang Mo Kio GRC) for employers' consent to be sought before maids can borrow from licensed moneylenders. He was drawing a parallel to a self-exclusion framework in which family members can apply to exempt an individual from entering casinos.
Under new rules announced last month, all Singaporeans and foreigners can apply to be self-excluded in borrowing from licensed moneylenders. But there is no provision for third-party application to exclude others without their consent.
The growing number of FDWs borrowing from licensed moneylenders in recent years has triggered concerns. Last year, about 12,000 maids borrowed money from licensed moneylenders, up from 1,500 maids in 2016. Already, 28,000 maids have borrowed money between January and June this year.
Releasing the figures in Parliament in response to questions posted by Mr David and Mr Sitoh Yih Pin (Potong Pasir), Senior Minister of State for Law and Health Edwin Tong said "the large majority of FDWs have repaid their loans from licensed moneylenders".
In a separate reply, Law and Home Affairs Minister K. Shanmugam said the police received about 460 reports of harassment by unlicensed moneylenders that came from FDWs borrowing or acting as guarantors between 2013 and September this year. The police did not receive similar reports between 2008 and 2012, Mr Shanmugam said, replying to a question from Mr Gan Thiam Poh (Ang Mo Kio GRC).
Employers are not liable to repay their FDWs' loans, said Ms Low, pointing out that FDWs who do not repay their loans may be subject to civil action by licensed moneylenders, as with any other borrowers.
Licensed moneylenders are not allowed to harass FDWs who borrowed from them or their employers for repayment, Ms Low added, advising employers who had been harassed to go to the police.
She said MOM will repatriate work pass holders who had borrowed money from unlicensed moneylenders and debar them from working in Singapore. Their employers will be informed too, she said, adding that the debarment period will be determined by the facts of the case. MOM had announced the debarment rule last month.