How to Apply For a Personal Loan as a Self-Employed Person, Freelancer, or Gig Worker

Person delivering goods

What would we do without the hardworking food delivery riders or couriers delivering our much-needed sustenance and packages? 

The last couple of years saw an unprecedented increase in the number of gig workers and contract jobs as people were laid off during COVID-19 or employers changed their hiring practices. 

According to a report by the Civil Service College, “alternative work arrangements such as contract-based employment, freelancing and self-employment are on the rise” globally. 

Many have their reasons for ditching the traditional 9-to-5 job and choosing an alternative way of working, from the mid-career professional seeking a change in their life to the new mother who prefers to work from home to take care of her child. The benefits of doing so include flexibility, having more personal time, earning more, and having greater control of your life. 

However, one area where self-employed individuals, freelancers, and gig workers may encounter challenges is when they may need to take a personal loan. 


Why self-employed individuals, freelancers, and gig workers may find it challenging to secure personal loans

People take personal loans to consolidate debt, finance major purchases or cover unexpected expenses that crop up. 

However, self-employed individuals, freelancers, and gig workers tend to have irregular income and less job security compared to someone in a permanent, full-time role. 

Traditional lenders such as banks and credit unions, typically see these as potential risks when evaluating loan applications. They have to ensure that the borrowers will be able to repay their loans on time and in full. 

Borrowers with irregular income or a history of job instability may be seen as being at a higher risk of defaulting on their loans. If their job and income are not secure, lenders find it difficult to assess their creditworthiness and are less confident in giving them a loan. They may also have more debt than income, which doesn’t work in their favour either. 

Another important factor that lenders consider when deciding to give personal loans is credit scores. Lenders use credit scores to help them make decisions about whether to approve a loan application and what interest rate to offer. 

READ MORE: A Beginner’s Guide To Understanding Your Credit Report In Singapore 2023

But that doesn’t mean being self-employed, freelancing or doing gig work affects your credit score. Lenders will look at your overall financial health including your monthly income and assets, as well as past borrowing behaviour, whether you’ve missed or made late payments.  

If you have a higher credit score, your request for a loan is more likely to be approved and you’ll have a lower interest rate vs. reduced chances for those with a lower credit score and higher interest rates. 


Practical tips on getting personal loans

So if you’re a self-employed individual, freelancer, or gig worker reading this and in need of a personal loan, here are some tips you can take to increase your chances of getting one: 

  • Pay all of your bills on time and in full each month
  • Don’t use too much of or all of your available credit 
  • Avoid opening too many new credit accounts in a short period of time
  • Check your credit report regularly for errors and dispute any inaccuracies
  • Maintain accurate and up-to-date financial records of all your income tax returns and invoices
  • Have a well-prepared plan that shows stability and reliability about your income, expenses and assets, and be prepared to answer questions that a lender might have


Exploring Loan Options: How UOB personal loans can help 

If you need a personal loan quickly, one bank that can make this happen is UOB. 

Application for a UOB personal loan can be done instantly—if you apply between 8 am – 9 pm. And you’ll get not just the approval, but also the cash!

What’s more, the interest rate for the UOB personal loan is from 2.88% p.a. (with an EIR starting from 5.43% p.a.). This is currently the lowest compared to all other banks in the market, which is currently 3.48% p.a. or higher. 

The processing fee for all tenors (the length of time of your contract) is also waived, so there’s no extra cost to you. 

When it comes to repayment, your monthly repayment can start from as low as $20±/month (based on securing a loan of $1,000 for 60 months at the current rate).

Depending on how long your loan tenor is (12, 24, 36, 48 or 60 months), the bank allows you to repay your loan within 1 to 5 years. 

Make sure to always be on time with your monthly repayments, you’ll be charged a late fee and the unpaid amount will accrue more interest until the payment has been received. 


How to apply for a UOB personal loan

To be eligible for the UOB personal loan, you have to be: 

  • An existing UOB Credit Card/CashPlus customer
  • A Singapore Citizen or Permanent Resident
  • Between 21-65 years old
  • Have a minimum annual income of S$30,000
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Before applying, you’ll need to be clear on the amount you need and a suitable repayment period based on what you can afford to repay each month. Remember, the longer the loan term, the lower your monthly payments will be, but you will pay more interest over the life of the loan.

Let’s say you take a loan amount of $10,000 for a tenor of 3 years.

At a prevailing interest rate of 2.88% p.a. and EIR 5.43% p.a., your total interest is $864±.

This means the final amount you have to repay is $10,864 ($10k loan + $864 of interest).

When you’ve decided how much and how long, you can go ahead to apply without the need to provide any documents. You just need to ensure your account is active and all your particulars are up-to-date. 

This is probably the most fuss-free option in the market for self-employed workers, freelancers, and gig workers who face challenges in getting approval for a personal loan. Just make sure you have the means to repay your loan on time!

Visit the UOB website for more details.


This post was written in collaboration with UOB. While we are financially compensated by them, we nonetheless strive to maintain our editorial integrity and review products with the same objective lens. We are committed to providing the best information in order for you to make personal financial decisions with confidence. You can view our Editorial Guidelines here.