If you’re struggling with multiple debts or considering your loan options, you might be asking:
👉 “Should I take a personal loan or a debt consolidation loan?”
👉 “What’s the difference, and which one suits my financial situation better?”
At Trillion Credit, a professional licensed moneylender in Singapore, we help individuals make informed borrowing decisions tailored to their needs. Below, we break down the differences, advantages, and use cases for personal loans vs. debt consolidation loans, so you can decide what works best for you.
Feature | Personal Loan | Debt Consolidation Loan |
Purpose | Any purpose: medical, travel, urgent cash, even to pay existing loans | Specifically to combine and repay multiple debts |
Number of loans | Adds to your existing loans | Combines multiple existing loans into one |
Interest Rate | Varies (depending on lender and credit score) | May be lower if used to replace high-interest debts |
Repayment | Separate from other loans | Single monthly repayment for all licensed moneylender loans |
Credit Impact | May increase total debt | Can improve credit score over time if repaid well |
A personal loan is a type of unsecured loan that can be used for almost any purpose—medical emergencies, weddings, education, travel, or even paying off other loans.
✅ Pros:
Flexible usage
Quick disbursement
Available to a wide range of income levels
❌ Cons:
May lead to more debt if not used wisely
Separate repayment from other loans
No consolidation benefit
A debt consolidation loan is designed specifically to combine multiple existing licensed moneylender loans into one. Instead of juggling several payments to different moneylenders, you’ll make just one monthly repayment—often at a better rate.
✅ Pros:
Easier to manage repayment
Can lower your total monthly obligation
May reduce interest rates
Helps prevent potential default and legal action
❌ Cons:
Only applicable if you already have multiple unsecured debts
May require more documentation (loan statements, proof of income)
Choose a Personal Loan if:
Choose a Debt Consolidation Loan if:
Case A – Personal Loan:
John takes home $4,000 per month. He has 4 outstanding loans from licensed moneylenders totally $5,000 and he feels it is getting hard to track. His debt size relative to his income is low and he has available unsecured loan quantum, so a personal loan of $5,500 suited him best for a quick consolidation of his loans.
Case B – Debt Consolidation Loan:
Rachel takes home $4,000 per month. She has 4 outstanding loans from licensed moneylenders totaling $20,000. Monthly repayments were overwhelming and she could not use a personal loan to consolidate her debt due to insufficient balance loan quantum. She applied for a debt consolidation loan with us, reducing her monthly repayment by 50% and relieving her financial stress.
At Trillion Credit, we help you decide which loan is truly right for your financial situation—not just the easiest to get.
If you’re still unsure whether a personal loan or a debt consolidation loan is better for you, don’t guess — let our experienced consultants assess your situation.
📱 Call us at 65090111
📝 Or apply now at https://trillioncredit.com.sg/apply-for-loan/
Yes, but you’ll still have to manage multiple loans unless you consolidate them under one repayment plan.
If you make timely repayments, a debt consolidation loan will definitely improve your credit score.
Yes, we specialise in helping borrowers with bad credit who still have repayment ability.