Placement fees and placement loans are a frequent source of confusion, and later of disputes. Understanding the rules before you sign makes it easier to agree fair terms with your agency and your helper.
Two different fees
- Your agency service fee: what you pay the agency for its services, set out in your agency contract.
- The helper's placement fee: what the helper pays the Singapore agency. Under the Employment Agencies Act, agencies may collect from a worker no more than one month of her fixed monthly salary for each year of service, capped at two months' salary.
Protections for the helper
- Agencies must issue itemised receipts.
- They must not collect fees before a placement is secured.
- If her employment is terminated within six months, the agency must refund at least half of the fee she paid. MOM notes this refund does not apply if she chose to end the employment.
- The IPA letter shows her fixed monthly salary and the fees paid to the Singapore agency, so she can check them.
Placement loans
Some arrangements have the employer advance the placement fee as a loan that the helper repays from her salary. If you agree to this:
- Write the loan amount and monthly repayment into the employment contract. MOM lists placement loans among the terms it encourages contracts to cover.
- Record each repayment on her salary record, signed by both of you, or use bank transfer.
- Read your agency contract's refund policy for loans. MOM's licence conditions require agencies to state it, including what happens if the helper leaves early with an outstanding loan.
MOM also notes that some agencies do not require employers to extend placement loans at all. If you prefer that, tell the agency at the start.
Questions to ask your agency
- What is the helper paying, and does it stay within the cap?
- Is there a loan, and what is the monthly repayment?
- What is the refund policy if the placement ends early?
Compare licensed agencies in our agency directory and see our cost overview.
A simple way to record a loan
Many families keep a one-page loan record next to the salary records. It shows the starting amount, each month's repayment, the balance after each payment, and both signatures. Paying salary by bank transfer and noting the repayment in the transfer reference makes the record even clearer. If the helper's circumstances change, for example she transfers to a new employer, the record makes it easy for everyone, including the agency, to see what is outstanding.
Common questions
Is the placement fee the same as the agency fee I pay?
They are separate. Your service fee is agreed between you and the agency; the placement fee is what the helper pays, and it is capped by law.
Can salary be withheld to repay a loan?
MOM requires you to pay her full declared salary on time. Any loan repayment should be agreed in writing and clearly recorded.
Last reviewed: September 2026. Procedures change, so confirm the current steps on mom.gov.sg or with your licensed employment agency.
