Singapore Caps Private Hire Car Loans at 60-70 Percent
New regulations, effective 30 October 2026, align borrowing limits for individually owned private hire vehicles with those for regular passenger cars, capping financing at seven years.
New Financing Limits Introduced
Singaporean authorities have implemented new borrowing restrictions for individually owned private hire vehicles, effective from 30 October 2026. These rules cap loan-to-value (LTV) ratios at 70 percent for vehicles with an Open Market Value (OMV) of S$20,000 or less.
For vehicles exceeding S$20,000 OMV, the maximum financing available falls to 60 percent of the purchase price, which includes applicable taxes and Certificate of Entitlement (COE) costs. All financing arrangements under these new rules are also subject to a maximum tenure of seven years.
Scope of New Regulations
The new restrictions apply to sales agreements signed on or after 30 October 2026. If no sales agreement exists, the rules take effect when the Certificate of Entitlement (COE) is obtained on or after that date. This regulatory framework covers loans from financial institutions, as well as licensed or exempt moneylenders.
It also extends to hire purchase and conditional sale agreements. While sole proprietors are included, business-owned private hire cars, along with commercial vehicles and motorcycles, remain exempt from these financing limits.
Addressing Registration Surge
The policy change addresses a notable increase in private hire car registrations. Authorities observed a rise in individually owned self-drive private hire car registrations, reaching approximately 500 per month recently.
This surge raised concerns that some buyers were leveraging a previous exemption for commercial vehicles to secure larger loans, potentially without intending to provide private hire services. Individually owned private hire cars were previously exempt from financing limits, unlike regular passenger cars, due to their commercial classification.
For individuals and sole proprietors seeking private hire vehicles, these new limits mean higher upfront capital requirements through larger down payments. Financial institutions and moneylenders will need to adjust their loan offerings and risk assessments for this segment of the automotive market.
The move aims to stabilise the private hire car market and prevent speculative purchases driven by lenient financing. Singaporean authorities will continue to monitor financing practices, including in-house loans, and collaborate with platform operators to ensure compliance.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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