Lendela Review: A Detailed Look at GXS FlexiLoan

A digital bank started by Grab and Singtel, GXS recently launched its personal loan product, the GXS FlexiLoan, to much fanfare. In this review, we’ll break down the features of the GXS FlexiLoan, how it stacks up with other personal loans, including Trust Bank’s Instant Loan, and potential considerations for borrowers looking to capitalise on some of its unique features.

What is the GXS FlexiLoan application process?

Firstly, much like Trust Bank’s Instant Loan, the GXS FlexiLoan process is entirely online. The loan application and approval process can be completed through the GXS app, and upon approval, you'll be assigned a credit limit, which represents the maximum amount you are able to borrow. 

Borrowers should satisfy the following requirements:

• Aged between 21 and 65 years old;

• a Singapore Citizen or a Permanent Resident; and

• have an annual income of at least $20,000.

Key features of the GXS FlexiLoan

Flexibility

From loan amount and tenure to repayment options, the GXS FlexiLoan stands out as one of the most flexible options out there. Borrowers will be able to choose loan tenures ranging from two to 60 months, a minimum loan amount of only $200 up to one’s credit limit, and draw down funds whenever they need to without any charges for inactivity. This makes the GXS FlexiLoan a suitable ‘standby’ option for small to medium cash needs, similar to a line of credit.

Unlike most traditional personal loans, repaying your GXS FlexiLoan in full early will not incur early termination fees. The loan’s simple interest structure also means that interest is calculated on the total loan amount right at the beginning and does not compound. Because the daily interest charge remains the same, there could be potential savings in the short term. 

Fee-free

One of the features that sets the GXS FlexiLoan apart is that it has no processing fees, early termination fees (discussed above), or hidden charges. The only fee is the late interest charge of 18% per annum, which is slightly lower than most credit cards’ late fees but much higher than the 4% average late fee on personal loans.

Zero percent option (balance transfer)

For borrowers who would like to consolidate existing debts, GXS recently launched a balance transfer option under their FlexiLoan offering, promising a 0% interest loan for four to 12-month tenures with a one-time processing fee depending on the length of tenure. This one-time fee starts from 1.35% (four months) and goes up to 3.85% (12 months) and is calculated based on the loan amount.

Fully digital

Part of why the GXS FlexiLoan process is as seamless as it is is because the entire loan application and management process can be experienced through the GXS app, making it more convenient than the average personal loan in Singapore. The app also boasts features such as prompts and reminders to help borrowers stay on track with their repayments, creating a user experience that’s digitally embedded and intuitive for digitally savvy borrowers.

Key considerations for borrowers

Advertised rates are not personalised rates

It’s important to recognise that the advertised rates you see from most loan providers are not your personalised rates. Statistically, very few people will qualify for the “from” rates after applying, and the GXS FlexiLoan is no different. 

This is why it’s crucial for borrowers to always seek out their personalised rates, and one of the quickest ways to access multiple personalised rates is through Lendela. Our platform automatically matches your borrower profile with your personalised rates from over 40 banks and loan providers, with just one online application.

The risks of easy drawdowns and lines of credit

While the flexibility and convenience that comes with being able to draw down funds whenever the need arises will be welcomed by many borrowers, it's important to be mindful of your loan affordability to avoid financial strain.

High usage of a credit line may also negatively impact your credit score since the credit utilisation ratio — the amount of credit used compared to your total credit limit — is a significant factor in credit scoring. All transactions including drawdowns are reported to the credit bureau, and high usage may adversely affect your credit score​​. 

In this case, the typical personal loan with fixed repayment schedules and interest rates does not come with these drawbacks, and while applying across multiple banks and providers to compare your real rates also hurts your credit score, using a loan matching platform like Lendela will ensure that doesn’t happen.

Longer term credit needs 

Today, about one in three borrowers in Singapore take out a personal loan for big-ticket purchases such as a business expansion, car, education, home-related expenses, medical bills, home renovation, and wedding costs (data from Lendela). Over a third of borrowers also have other long term or large credit needs, including debt consolidation. 

For them, typical personal loans with fixed repayments across a longer tenure will make more sense since interest will be spread out over a longer period of time, as opposed to a simple interest structure that charges interest daily on the full amount borrowed, such as the GXS FlexiLoan and Trust Bank's Instant Loan. 

In such cases, making an informed decision on your loan could result in savings of thousands of dollars, making it incredibly helpful to have all your personalised loan options laid out in front of you clearly. Lendela does just that by matching borrowers with personalised offers from over 40 banks and loan providers, and in minutes.

The digital downside 

While a fully digital experience such as the one offered by GXS’s FlexiLoan may be ideal for some, from our experience facilitating hundreds of thousands of loan applications, most borrowers appreciate the human touch that is often missing from typical loan application processes. 

While technology may solve certain issues, nothing quite replaces the personalised service borrowers need when they want to clarify loan terms, financial jargon, or have questions unique to their circumstances. This is why Lendela places such a huge focus on ensuring our customer care is always personalised, empathetic, and solution-driven. 

No incentive to repay early 

With compounding interest, repaying a loan early can significantly reduce interest costs. In a non-compounding loan, the benefit of early repayment diminishes, potentially reducing the incentive for borrowers to pay off their debt sooner.

Have you considered the Effective Interest Rate (EIR)? 

Finally, as with all loans, the two most important numbers to note when considering the cost of a loan are the Annual Percentage Rate (APR) and the Effective Interest Rate (EIR). The EIR is the total cost of a loan shown as a percentage of the amount borrowed. Unlike the APR, EIR takes into account the impact of compounding interest. In other words, it tells you what you’ll actually have paid at the end of the loan tenure. For a full rundown of the EIR, read this.

Always explore all loan options available to you

Without knowing all the loan options available to you, it’s impossible to make an informed decision. While most borrowers recognise that comparing personal loan rates is an effective way to find their most competitive offer, advertised loan rates are not personalised.

This leads most borrowers to apply across multiple banks and providers to compare their real rates, unknowingly hurting their credit scores since each loan application leaves a record on your credit report, sending a signal to banks that you might be a “financial risk”.

This is why instead of simply comparing rates, using a loan matching platform such as Lendela is the safer and quicker way to find your ideal loan, always. By bringing the most competitive personalised rates to you, Lendela makes it cheaper, faster, and safer for you to borrow.

Disclaimer: Lendela remains committed to neutrality and transparency in our reviews and loan products to aid in your decision-making process. This review is solely based on our research and evaluation. For more detailed inquiries or specific questions about GXS FlexiLoan, we encourage you to contact the credit provider directly.