Business Loan Singapore That Help Boost Your Company

Credit Counselling Service Singapore

Businesses need the enough amount of money to achieve its success. There are a lot of expenses that need to be covered by a business and if a company decides to expand, this might be the right time to ask for a financial assistance and apply for business loans in Singapore. 

However, business loans can sometimes be complicated and the company will need to understand the business term loan completely before getting into it. Make sure that the lenders are on the legal side or else you might have to say goodbye to your business in the near future. 

It is the responsibility of the business establishment to repay the loan that they got from the business and they should be well aware of the terms and conditions of the lenders to be able to manage your finances very well.

Most of the business loan Singapore lenders can offer $300,000 up to a maximum of  $500,000 as the amount of money to be loaned. Sometimes, these loans are being used by owners to pay for the salary of their employees as the business might not be in good shape in a specific time. 

Others may use it to pay for an equipment for the business, supplies for the office and other projects that are for the sake of the business. The owner of the companies should provide lenders specific documents in which they intend to spend the money that they are borrowing. It is very important to have your intention to have business loans clear, concise and professional. 

There are banks that can present you plans for your business loans Singapore and there are other private financial institutions who are also willing to discuss this certain loan with you. You just need to be careful in choosing which way to go and who to trust. 

Also, make sure that the money lender that you are dealing with is legal and follows the rules of the Singapore government.

man presenting a business plan

What are the types of Business Loans?

There are several options to choose from if you want to avail for a loan business. One is via traditional bank loans wherein you can borrow money from the bank of your choice.

This is the most popular of them all however, getting a loan from banks is not that easy. With the economic struggles that the country is facing, banks have been so tight when it comes to lending money to businesses.

There are also private companies who offer capital loans to most of the local businesses. Loan application process for a business is not so easy but as long as you have the proper documents, you can be sure that you will go away with your business loans fast.

man presenting a business interest

Talk about Interest rates

There are no banks or financial institutions and companies wherein you can get a loan that does not have an interest rate. All of the money lenders nowadays are charging an interest rate that is based on the amount of money that you will borrow, the duration of repayments and your credit score.

They have different set of interest rates and the amount of money that they offer for you to borrow. There are some who offer fixed interest rates that are the same during the whole duration of the repayment. There are also some who offer variable interest rates that can be fluctuating based on some factors. 

office colleagues

How important are business loans?

Not all companies that submit their loan application are automatically approved by the lender. There are procedures that go thru with applying and some of them are important documents that a business should present whenever applying for a loan. 

The private money lender Singapore should also be made aware of the standing of the business that is why you should be honest with the details of the businesses for the lender to trust you better and give you more that what you expect.

Banks and financial companies have their ways in finding out whether you are telling the truth or not. If you lie to them, this might be another trouble for you because if you get caught, you will be rejected for a loan and you might also get black listed to all lending companies across the country.

Business loans are important for those companies that are just starting up as well as to those companies that are having financial trouble with their businesses. A capital loan will help them boost the business and keep up with the economic competition.

If you were able to secure a business loan and your interest rate is quite high, you should do your best to make repayments in a short period of time because a high interest rate can be the downfall of the business and will give you more financial struggle.

What banks offer:

We did the research and discovered some figures that most banks offer for sme loans. DBS SME loans offers business term loans for companies with a maximum of 5 years repayment period, about 10.88 percent of interest rate, processing fee may be 2% of the loan amount and their early redemption penalty is 25 percent.

OCBC offers the same maximum repayment period of 5 years as well as the interest rate of 10.88 percent with 2 percent of the loan amount for the processing fee and 5 percent early repayment penalty. UOB offers almost the same however, the maximum loan amount is about $350,000 with repayment period of 4 years. The early repayment penalty is 6.88 percent.

Banks have different criterias and preferences when it comes to lending money to companies. It may vary through the industry, tenureship of the business, financial assessments, purpose, cash flow, etc. You can also check out for special promotions, they sometimes do promotions with lower interest rates.


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