BUSINESS TERM LOAN

Call: +65 8336 3133 or Email Contact@Frcapital.sg

SME BUSINESS TERM LOAN SINGAPORE

An SME Business Term Loan for your daily operations, business expansion, or contingency for your working capital in Singapore.

Business Loans in Singapore may benefit your company in several ways, such as buying fixed assets like equipment for production processes.

These pieces of equipment will start to prove a constant stream of revenue for your company while your loan is being repaid. Be it for investment, property expansion, injection, or new technology implementation, We provide you easy access to extra funds, from Temporary Bridging Loan to Working Capital Loans to property secured loans, so that you can entirely focus on growing your business.

We offer SME Business Term Loan, which is designed to boost your company’s working capital.

Enhance your cash flow and improve your daily business operations with an SME Business Term Loan in Singapore.

SME Business Term Loan is created to boost Singapore company’s working capital with attractive interest rates. Get company loan facilities to secure business possibilities, obtain office equipment, restore your premises, and more.

Borrow as much as SGD 500,000 at engaging interest rates for up to five (5) years with this collateral-free loan.

We look into the following and assist you in explaining to the banks the following information about your business:

  • Character & business experience
  • Credit capacity

  • Financial statement of personal finances to evaluate your ability to repay Financial statement of personal finances to determine your ability to repay 
  • Collateral, which should be bigger than the amount you’re borrowing, Capital, and Accuracy of your revenue & expense projections 

It is easy to apply, with speedy processing time. Leave all the hassle & complicated explanations to us. 

Click HERE to submit your loan inquiry now! 

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TYPES OF BUSINESS TERM LOANS WE AUTHORIZE IN SINGAPORE 

Below table shows the range of business loans interest rates for various SME loan products:

loan Type Interest Rate(EIR)
Unsecured Business Term Loan from Banks 7% – 10% p.a.
Temporary Bridging Loan from Banks 2.5% – 5% p.a.
SME Working Capital Loan from banks 3.5% – 5.5% p.a.
Trade Financing Line 2.5% – 6.5% p.a.
Overdraft Facilities (OD) 5% – 8% p.a
Equipment/Machinery Loan 3.5% – 6.5% p.a
Commercial/Industrial Property Loan 1.7% – 2.7% p.a.
P2P Crowdfunding/Alternative Funder 1% – 5% /month

Financial Example

The central location of ABC Technology has been a consistent number of clients for the last seven (7) years. But, due to Covid-19, the business revenue went down, and they do not have enough reserves to pay the employees & supplies.

Faced with such a situation, the owners of ABC Technology approached Us for a financing option. We suggested that ABC Technology should consider a Term Loan to get funds.

Taking up the term loan financing option is the best decision they have made thus far. Term loan financing provides a handy and hassle-free way to finance their company. As an outcome, they were capable of getting the funds they needed.

We offered ABC Technology the following terms:

  1. Business Loan: $300,000
  2. Interest Rate: 3% effective
  3. Monthly Repayment: $5390 X 60 months

In this example, ABC Technology was able to pay for supplies and their employees to operate. It only needs to pay $5350 per month through a Term Loan agreement.

* Disclaimer: The example above is merely shown for illustration purposes to allow better readers to understand the uses of each financing solution. The figures and interest rates listed above are not representative; they may differ based on each company’s requirements & management’s approval. Additional terms & conditions may also apply based on the credit assessment & evaluation conducted during application. Our management consultants Pte Ltd. and its employees are not responsible for the completeness or correctness of the computation, whether implicitly or unambiguously.

Funding Overview

Loan Quantum Up to S$5 million of unsecured loans collectively
Interest Rate From 3.9% simple interest p.a (effective interest 7.5% p.a)
Processing Fee From 0.8% to 2% of the total approved loan amount
Repayment Period Between 1 to 5 years

Application Criteria

  • Eligibility

• A business incorporated in Singapore for at least six (6) months with at least 30% local shareholdings (Singaporean and PR).

• A business that has an existing corporate account with active transactions for at least six (6) months

• A business with an Annual Sales Turnover of ≤ S$100million or CPF-payable Employees ≤ 200

  • Documents

• NRIC copy (front & back) of directors/ partners/sole-proprietor

• Individual Income Tax Notice of Assessment (NOA) of directors/partners/ sole-proprietor for the last two (2) years.

• Company bank statements for the last three (3)* or six (6) months

• Business financial reports/statements for the last one (1)* or two (2) years

*Dependent on Financier’s requirement

Get started in 4 easy steps.

  1. Fill up the form & submit
  1. Engaged by our designated consultant
  1. Consultant presents on the proposed business solution
  1. Get your funds upon approval

How It Works

  • In receiving your inquiry, our assigned Business Consultant will get a summary of your business finance.
  • The assigned Business Consultants will brief you on the application process, the best-suited solution, and credit facilities for your company based on your needs during the scheduled appointment.
  • We will assist you with the whole process of your application until approval & disbursement.
  • During the procedure, they might ask for additional documentation required to aid in the application’s approval.
  • Please allow 2 to 4 weeks* to evaluate, submit, negotiate, and approve your application.

• If approved, disbursement takes about 3-5 working days upon signing the Letter of Offer.

Fill up the form

Start Your Application Today!

We help our customers get the proper financial assistance by objectively evaluating their company profile & documents before finding the most relevant financial institutions to give them the highest loan approval chances.

We also try to get the most desirable deal for our clients by looking for the cheapest interest rates in the market, but this could still differ depending on the company’s financial standing & profile.

If your company cannot qualify for a loan now, we also advise on what areas you can improve to be eligible in the future.

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A corporate loan is a penny capital (a specified amount of capital) you repay with a fixed (or a fixed) capital & interest rate, a “factor rate,” which is a fixed cost. A fixed loan is a fixed rate of repayment.

A loan for a business term is a lump sum of capital that you pay back at a fixed interest rate with regular repayments. This kind of conventional funding is what most people believe when it comes to small business loans. The loans are issued by banks, credit unions, and online lenders for business terms.

Companies need capital to acquire the assets they need to produce their goods and services. The operating capital needs of companies often exceed the cash available to the company. A term loan can support the financing of those investments.

The term Investopedia loan definition is “…the loan from a bank with its fixed or floating interest rate for a particular amount that has a specific repayment schedule.”

Typically, the term loan contains fixed payments (ordinarily monthly) and a due date for repayment of the loan. Usually, the entire duration of the loan is over one year. Term loans are frequently used to pay for fixed assets, but some firms can use them for daily transactions.

Term financing usually takes the form of a bank loan, which can lead to some financial delays. Many bankers will evaluate your loan and sales history since they want to work with well-established companies.

The next issue you will negotiate is the fixed or variable rate of the interest rate charged for the loan. In normal circumstances, fixed interest rates function well if the current rate is low and you receive a low rate from a bank.

When interest rates are high, a variable rate might be worth it, as you can negotiate the rate below the present interest rate. Ask your borrower if you can set a rate cap to keep the payment affordable.

To process the refund from a commercial bank or financial institution, you must first understand that starting a new business is challenging. The riskiest loans a bank or lender can find are for new companies. Understandably, they are also concerned about startup loans.

 Why Business Startups Are Risky 

 See the four C’s of Credit to understand why new startups are risky for business lenders (collateral, capital, capacity, character).

 The borrower expects lenders:

  •  Capital – Corporate assets that you can use for creating products or services can be converted into money to pay for corporate loans. A new company has little business value, especially a service company.
  • Collateral – Cash to help the company. A company’s new owner has little collateral if they can use personal property or has a co-signer with property to commit.
  • Capacity – A track record is showing that the company can generate sufficient money to repay the loan.
  • It’s a good credit rating in particular. However, it doesn’t mean that you can get a business loan if you’re good at credit rating (business credit or personal credit), but you will probably get a bad rating quickly turned away.

Entrepreneurs are frequently stranded these days because they are unable to anticipate their daily financial needs. They create a financial business plan, but it ignores daily cash flow requirements. Did you know that most new businesses fail within their first two years due to cash flow issues rather than profitability? After all, even before they see their first revenue, entrepreneurs have many bills and salaries to pay.

To determine daily/weekly requirements, create a liquidity plan, which is a chart that shows all expected outgoing and incoming payments for the first (and subsequent) years, broken down month by month. Bank financing is frequently a simple solution to liquidity problems. Yes, it’s simple. However, it is not always simple to obtain. Bank financing can be used for a rent guarantee, fund a commercial space, or rent a vehicle via a finance lease.

Which elements are key for convincing your bank to get behind your business model?

What you need to understand is that a bank is a business that is very similar to your own. A bank lends money while you sell a service or product. Because a bank’s income is derived partly from the interest you pay them, bankers will go to great lengths to ensure that the money you owe them is repaid.

Every customer who takes out a loan in a bank is a potential financial risk.

The bank representatives use the figures you deal with to back up their decision compared to statistical data. The higher the financial risk, the more expensive the loan, in theory (and the higher the interest rate). That is why it is in your best interest to provide your bank with all tangible information to instill confidence in your banker and demonstrate a level of security – both of which will help you get a better rate. Provide complex data in figures from the start of your loan application process if you want to take advantage of your banker’s mindset.

Many entrepreneurs who applied for bank loans were turned down. Banks reject loan applications for various reasons; some are simple to fix, while others may take a significant amount of time and effort.

Many entrepreneurs who applied for bank loans were turned down. Banks reject loan applications for various reasons; some are simple to fix, while others may take a significant amount of time and effort.

YOUR ABILITY TO REPAY

Losing the initial capital lent to you is the worst-case scenario for a bank. As a result, they must be sure that you will be able to repay the loan. One way to do so is to apply for a loan based on a large sales order. If you cannot do so, you must demonstrate that the funds will be invested in ways that are likely to yield a reasonable return. The bank may want to learn more about your management team, their experience, and how they plan to profit with the funds.

YOUR ABILITY TO MAKE A PROFIT

Banks aren’t charitable organizations; they lend you money to make more money. It’s unlikely that they’ll give you the money if they don’t think you’ll be able to make a profit on the loan amount. This is why it’s critical to spell out exactly what the funds will be used for, when you’ll use them and how you’ll repay them. You must gain the bank manager’s support; if they are convinced that you will make a profit, you are on your way to success.

YOUR BUSINESS MODEL/PLAN

It would help if you convinced bank managers of your overall business strategy and your need for investment. If your business model isn’t sound, the bank manager’s confidence in any part of your application may suffer as a result. Your bank manager needs to believe you have business acumen, and one way to tell is by looking at your business model. Before you go to the bank, make sure yours is solid and commercially viable.

TOO MUCH RISK

Banks are hesitant to invest in businesses that are too risky. Securing a bank loan often requires removing as much risk as possible. Take out enough insurance, make backup plans, and do everything you can to convince the bank manager that your business model has a good chance of succeeding. A lack of risk is one of the most common reasons for loan rejection, so make sure you’ve covered all of your bases.

YOUR DEMEANOUR AND PRESENTATION

Bank executives must have faith in both your ability to deliver and your business plan. A bank manager is unlikely to be enamored with you if you arrive late and dress shabbily. Create sure you present yourself in the best possible light; the bank manager must decide whether or not to invest a large sum of money in you. If you treat everything with seriousness, they will do the same.

MAKING THE BEST CASE, YOU CAN

If your loan application is denied, use the experience to improve your next application. Don’t be afraid to devote a significant amount of time to your application’s preparation. Use a professional accountant to provide the most important figures and present them in the best light possible. If you’re having trouble, check out our guide on how to apply for a business bank loan to get back on track.

Personal loans have interest and credit implications, but they also have several potential advantages. For example, credit history requirements for personal loans are typically lower than those for other types of loans. Personal loans are also more adaptable than most other loans (mortgage loans and auto loans, for example, are intended for particular purposes). These loans offer reasonable interest rates and flexible repayment schedules (from 1-7 years, depending on your credit and your lender).

In addition, there are times when obtaining a personal loan is the best option available to you. Here are a few scenarios in which getting a personal loan would be a good idea:

You Want to Do a Home Remodel

If, however, you do not get plenty of cash on hand to renovate your house, a personal loan may be able to help you out. If a remodel will make your home a better living space for you and your family, it is a wise use of personal loan funds, especially when compared to the option of purchasing a new home and taking out an entire mortgage.

You Are Facing a Significant Unplanned Expense

The most obvious reason to consider a personal loan is if you are confronted with a significant unforeseen or emergency expense. Perhaps you or a family member has become ill or suffered a severe injury, and you are facing medical bills that are beyond your means. Maybe a parent recently passed away, and you’re preparing for their funeral. Perhaps a storm has damaged your home, and you’ll need a loan to cover the costs that your insurance won’t cover. These situations are difficult to anticipate, making the costs associated with them a significant burden. A personal loan may be of assistance.

You Need to Consolidate Debt

One of the best reasons to take a personal loan is to consolidate other existing debts. Let us say you have a few outstanding obligations—student loans, debt with a credit card, and so forth—and you find it hard to repay. A debt consolidation loan is a kind of personal loan with two main benefits. To commence, all of your debts are consolidated into a single loan to make tracking and payment easier on time. Secondly, you can replace high-interest debts with lower interest loans to reduce the amount of interest you pay.

You Are Considering a Large Purchase

Depending on your expenses, the size, and the repayment strategy of the loan you need to cover, you can take this cost either way. Anything from a new fridge to a dream holiday to your wedding budget is considered to be a “high cost.” You have to consider how critical the cost is in each case.

For example, you may need to get a new one when your freezer breaks – whether or not you can afford to do that out of the pocket. With a wedding, the advantages and disadvantages are harder to weigh as spending is likely to be reduced. Still, you can also say something about investing in life’s great experiences that you would never forget. It would help if you ultimately decided for yourself whether a necessary purchase justifies a personal loan or whether you want to look at other options, such as waiting for a year and saving money in the meantime to take your dream vacation.

You Need to Build Credit

 Were you aware of a kind of personal loan—called a credit creditor loan—which you can use to create a credit history? It may be reasonable to take a personal loan if you have a poor loan or little to no loan.

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About FR Capial

FR Capital is a Singapore consultancy firm that helps SMEs to secure business loans from banks and financial institutions. We concentrate on SME finance, and through our expertise and network, we help clients secure funding with low-interest rates efficiently and hassle-free.