Why commission calculation is disputed — and the sources of every discrepancy
Commission discrepancies between what the referral partner expects and what they receive originate from four sources. The first is the base amount: the commission is calculated on the disbursed amount, not the approved amount — and the referral partner may not know about any reduction between approval and disbursement (a borrower who took a smaller loan at disbursement reduces the commission proportionally). The second is the rate tier: many commission structures are tiered — a higher rate applies above a certain monthly volume threshold, and the referral partner may believe they crossed the threshold when they did not, or may not know that the institution's volume calculation excludes certain loan types. The third is hold conditions: some institutions hold a portion of the commission until the first 3 EMIs are paid — and the referral partner may not have been clearly informed of this condition at onboarding. The fourth is withholding tax: a 5% withholding tax is deducted at source on commission payments above SGD15,000 — referral partners who did not submit Form 15G or whose PAN is not linked may have additional withholding tax applied.
The commission structure: product, tier, and volume
(HL)
1.00% of disbursed amount · Paid on disbursement · No hold condition
Home loan commissions are paid on the disbursed loan amount, not the approved amount. Commission is payable within 7 working days of disbursement. No instalment hold condition for home loans since the collateral provides security. withholding tax at 5% for total monthly payout >SGD15,000.
(HL) — volume
1.50% on all home loan disbursements when monthly total exceeds SGD50L
The higher rate applies to the entire month's HL disbursements (not just the incremental above SGD50L) when the referral partner crosses the threshold. The upgrade is automatic — the referral partner does not need to request it. Volume is calculated on all HLs disbursed in the calendar month regardless of approval date.
loan
1.25% of disbursed amount · 50% on disbursement · 50% after 3rd instalment paid
SME loans carry a hold condition: 50% of the commission is paid on disbursement, the remaining 50% is released when the borrower pays their 3rd instalment without default. This protects the institution against early-default cases where the referral partner may have sourced a borrower who defaults immediately. The hold condition is disclosed at referral partner onboarding (Module 3).
loan — volume
1.75% on all SME disbursements when monthly total exceeds SGD30L
Same mechanics as the HL volume tier. The higher rate applies to the entire month's SME disbursements once the SGD30L threshold is crossed. The hold condition (50% after 3rd instalment) still applies to the full rate.
Mortgage
0.75% of disbursed amount · Paid on disbursement · No hold condition
LAP commissions are flat rate with no volume tier. The lower rate reflects the larger average ticket size (LAP average disbursement: SGD65L vs HL: SGD38L). In absolute dollar (SGD) terms, LAP commissions are comparable to HL commissions per case despite the lower percentage.
loan (PL)
2.00% of disbursed amount · 100% held until 3rd instalment paid · Highest rate, highest risk
Personal loan commissions carry a 100% hold condition — the full commission is only released after the 3rd instalment is paid, because unsecured personal loans have the highest early-default rate in the portfolio. The 2% rate reflects the higher yield on PL but is only realised if the loan performs in its early months.
Arjun Rahman's November commission statement
Ananya K. Home loan SGD42,00,000 1.50%* SGD63,000 − withholding tax SGD3,150 = SGD59,850 Paid
Ramesh Aisyah Home loan SGD38,20,000 1.50%* SGD57,300 − withholding tax SGD2,865 = SGD54,435 Paid
Priya N. Home loan SGD40,00,000 1.50%* SGD60,000 − withholding tax SGD3,000 = SGD57,000 Paid
Ahmad SME SME term SGD18,40,000 1.25% SGD23,000 × 50% = SGD11,500 (50% held) SGD11,500 paid
Ravi SE Loans SME term SGD10,00,000 1.25% SGD12,500 × 50% = SGD6,250 (50% held) SGD6,250 held
Kaveri LAP LAP SGD36,00,000 0.75% SGD27,000 − withholding tax SGD1,350 = SGD25,650 Paid
A referral partner who can verify their commission to the dollar (SGD) is a referral partner who trusts the institution
The referral partner / Channel Partner AI's commission statement is not just an accounting record — it is a trust document. When Arjun opens his December 7 statement and sees that his three home loans crossed the SGD50L threshold and upgraded his entire month's HL commission to 1.50% — a fact he may not have tracked himself — his first reaction is not suspicion but appreciation. When he sees the SME hold amounts explained with the specific release condition, he understands the mechanic rather than resenting the deduction. An institution that explains its commission computation completely, accurately, and proactively builds a referral partner network that stays — because the referral partners feel they are treated as partners, not as managed vendors.