Strengthen Regulation of Moneylenders | Xu Zhengyu: Has Referenced Foreign Domestic Helper Monthly Salary and Meal Allowance, etc.

SighingCashier · 2026-03-15T05:01:53+00:00

The Financial Services and the Treasury Bureau will strengthen regulation of licensed moneylenders, with the first phase of measures taking effect in August this year. For borrowers with monthly income below 6,000 yuan, the repayment ratio cap is 35%, while for those earning 6,001 to 12,000 yuan, it is 40%. These measures aim to optimize the system and protect the interests of both moneylenders and borrowers. Relevant thresholds will be reviewed every two years, and moneylenders are prohibited from requiring borrowers to provide consultants to safeguard borrower privacy.

SighingCashier

2026-03-15 05:01:53

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The Treasury Department is strengthening regulations on licensed money lenders. The first phase of measures will take effect in August this year. For those with monthly income of $6,000 or less, the maximum debt service ratio (DSR) will not exceed 35%. For incomes between $6,001 and $12,000, the limit will be no more than 40%. Treasury Secretary Christopher Hui stated on a radio program that the regulations reference the basic monthly salary and meal allowances for domestic helpers, hoping that these restrictions will help the market develop steadily.

Hui pointed out that setting the thresholds at $6,000 and $12,000 is based on the basic monthly salary and meal allowances for domestic helpers. The goal is to create a tiered, risk-based system that optimizes the framework while ensuring the interests of both lenders and borrowers are protected. The authorities have communicated with relevant consulates and held seminars for domestic helpers to explain safe and legal borrowing channels.

Hui said, “From a risk-based perspective, low-income individuals earning between $6,000 and $12,000 have relatively lower risk compared to those earning less than $6,000. Therefore, we allow a higher monthly debt repayment ratio of up to 40%, instead of 35%, giving them more flexibility. Of course, we will continue to use various measures to ensure the sustainable development of the lending system.”

He mentioned that the authorities will review the thresholds every two years, aiming to implement all regulatory measures in two phases—first in August this year and then in June next year.

The first phase also bans lenders from requiring borrowers to provide a loan advisor. Loan agreements will include risk warnings. Hui explained that in the past, non-borrowers were sometimes listed as advisors, causing disturbances. The measures aim to ensure that information unrelated to the borrower does not fall into the hands of lenders.

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