The Monetary Authority of Singapore's (MAS) announcement to lift car loan restrictions, that were imposed earlier this year, on the dealer's inventory by 60 days is seen as a temporary relief for the struggling used car industry. The 60 day allowance is expected to spur a re-interest in the used car industry - at least monetarily - and aid with the clearing of stock held by the used car dealers.
The temporary concession covers cars registered on or before March 4th which calculates to less than 7,000 cars.
MAS explained why the loan restrictions were lifted, "The inventory of used cars acquired by dealers at relatively high inbuilt Certificate of Entitlement values before the introduction of the financing restrictions has made it particularly challenging for them to adjust to the new market conditions. Demand has also fallen more sharply in the used car market compared to that for new cars."
In a separate announcement MAS has also extended the auto loan restrictions to all credit companies and moneylenders for financing. At the end of February, MAS capped car loans at 50 or 60 percent and reduced the loan period by five years. Dealers have up to seven days to register used cars under the Land Transport Authority's (LTA) Temporary Transfer Scheme - which aims to aid the industry in adjusting to the new conditions.
