How did the whole subprime mess start? Banks lent money to people with low income and these people defaulted on their debt.
MAS has now lowered the income requirement for unsecured loan to S$20K. Now instead of the govt giving workfare to the people whose income is not sufficient for their basic needs, they can send these people to borrow from the banks. The same day this revision was announced there was a report to say that an increasing number of people are struggling with their personal debt:
SINGAPORE: From next month, the minimum income requirement to apply for unsecured credit facilities will be lowered from S$30,000 to S$20,000. This will essentially allow more individuals to obtain such facilities subject to a cap of twice their monthly income. The Monetary Authority of Singapore (MAS) said the revision will allow access to unsecured credit to more individuals who may have occasional genuine borrowing needs but not if they have a spotty record with Credit Bureau Singapore. That's because MAS has made it a requirement for financial institutions to conduct comprehensive checks with the bureau before granting each new credit card, charge card or unsecured credit facility. Under the revised rules, financial institutions will also be barred from making unsolicited offers of unsecured credit facilities to customers unless customers write in for them. This follows similar restrictions on unsolicited offers of credit cards already in place.