Compare Car Finance in Singapore

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20 live offers compared from 15 providers, from 2.48% APR. Updated daily.

What is car finance in Singapore?

Car finance is a loan that lets you spread the cost of a vehicle over several years rather than paying the full price upfront. In Singapore, car ownership is uniquely expensive because every car needs a Certificate of Entitlement (COE), a costly, quota-limited right to own a vehicle, on top of the car's price, taxes and registration fees. Loans, usually structured as hire purchase, therefore finance a large sum, and borrowing is tightly capped by regulation to encourage prudence.

How the Singapore market works

Car loans are offered by banks and, sometimes, in-house financing arranged through dealers. Because prices are inflated by COE and taxes, MAS imposes strict limits: financing is capped at 70 percent of the purchase price for cars with an Open Market Value up to S$20,000 and 60 percent for those above, and the maximum loan tenure is seven years. Rates are typically quoted as a flat rate per year on the original amount, which differs from an effective interest rate. Buyers fund the balance in cash.

Benefits

Spreads a large cost — Finance makes the substantial total outlay of a Singapore car manageable over several years.

Fixed monthly instalments — Hire-purchase loans usually carry fixed flat rates, giving predictable payments.

Competitive bank pricing — Multiple banks compete on new and used-car loan rates and promotions.

Preserves cash — Financing part of the price leaves savings available for other needs.

How to choose

Compare the effective interest rate, not just the advertised flat rate, since a flat rate understates the true cost; convert to effective terms or ask the lender. Check the maximum financing you qualify for under the 60 or 70 percent cap, the tenure up to seven years, and total interest paid over the life of the loan. Look at early-settlement rebates and fees, and whether new and used cars are priced differently. Shorter tenures cost less interest overall.

Leading providers in Singapore

Major car-loan banks include DBS, OCBC and UOB, alongside Maybank, Standard Chartered, CIMB, RHB and Citibank. The local banks offer widely used new and used-car loan packages with competitive flat rates, while foreign and regional banks compete on promotions and specific segments. Dealers often arrange financing through these banks at the point of sale. Since rates and rebates vary, comparing effective rates and settlement terms across lenders is worthwhile before committing.

What it costs

Car loans are quoted as a flat rate per year, commonly in the region of 2.5 to 3.1 percent for new cars, with used-car rates typically higher; the illustrative figures shown are per-annum flat rates. Because interest is charged on the original amount throughout, the effective rate is meaningfully higher than the flat rate. Additional costs can include processing fees and early-settlement charges. The largest cost overall remains the car itself, driven by COE and taxes.

Protections and regulation

Car financing from financial institutions is regulated by the Monetary Authority of Singapore (MAS), which sets the loan-to-value caps of 60 and 70 percent and the seven-year maximum tenure to moderate demand and encourage financial prudence. Hire-purchase agreements are also governed by the Hire-Purchase Act, giving borrowers defined rights. Note that some dealer leasing or lease-to-own arrangements fall outside MAS loan rules, so read those terms carefully. Bank disputes can go to FIDReC.

Common questions

How much can I borrow? — Up to 70 percent of price for cars with OMV up to S$20,000, or 60 percent above that, over a maximum seven-year tenure.

Why is the effective rate higher than the flat rate? — Flat rates charge interest on the full original sum throughout, so the true effective rate is higher.

Can I settle early? — Usually yes, often with a partial interest rebate but sometimes a fee, so check the terms.

Car Finance in Singapore — FAQ