You’re a struggling SME (small-to-medium enterprise) or small business owner, and you’re looking to increase cash flow with a loan. What are the choices? Let’s cover the small business loan options in Singapore & what you can do if you do not pass an SME loan.
When it comes to business loans, (3) factors matter most to you: the maximum amount you can acquire, the interest rates, & cash disbursement speed.
Given that there are over twenty (20) private lenders, non-bank financial institutions, and peer-to-peer (P2P) lenders in Singapore, you’re unlikely to get the most suitable loan offer unless you apply individually with each lender.
The criteria they use to evaluate creditworthiness may be the same. But each lender places a distinct emphasis on each factor. Furthermore, their risk appetites vary too.
This is why two (2) lenders’ loan bids can be as low as $100,000, while interest rates are as high as 12% annually!
At Finitude, we’re a company loan platform specialized in helping your business find the best loans – with just a straightforward application form.
Whether your business is only ten-months old or has low revenue or poor credit score, we can help.
We work with private lenders, non-bank financial institutions, and peer-to-peer lenders.
Their larger risk appetites mean that less emphasis is placed on your business’s track record, annual revenue (most banks and financial institutions require a minimum of $300,000), business ownership, and credit score.
All that’s required is for your business to be a Private Limited Company with annual revenue of $100,000.
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What are the Business Loan Options in Singapore?
Business loans are a term used to describe all business-related credits offered to a company. There are many kinds of business loans: Some are just provided for whatever business needs you might have (such as managing cash flow or furthering your growth). In contrast, others are explicitly offered for specific business needs (such as machinery/equipment or property loans) or even types of businesses (start-ups). The most common types are covered below.
Why Might Your Business Loan Be Unsuccessful?
As you can see, SMEs in Singapore are provided with numerous types of company loans. The government has even stepped in to guarantee that funding is available to more small businesses. Nevertheless, your business loan application may still be unsuccessful – and also, you will typically only find out after applying for the loan & waiting two weeks for it to get processed. Here are some potential “problem areas” when you are trying to secure a business loan:
Personal Loans for Small Businesses in Singapore (2020)
If you are unsuccessful or do not pass for a small business loan, you may consider getting a personal loan alternatively. A personal loan has somewhat more relaxed requirements; however, the loan amount is also much smaller – for example, four times your current salary. Therefore, personal loans are best suited to salaried workers looking to start their side businesses and don’t need much to kick it off.
Personal Loans for Small Businesses in Singapore (2020)
Business Loans vs Personal Loans in Singapore
BUSINESS LOAN | PERSONAL LOAN | |
---|---|---|
Loan Amount | Up to S$ million | Up to 4X monthly salary |
Loan Period | Up to 5 years | Up to 7 years |
Documents Required | ACRA records, business financial reports, etc. | Personal salary records |
Business Age Requirement | Min. 6 months, some require min. 2 years | None |
Processing Time | 2 weeks or more | Within a few days |
Common Business Loan Reasons
HSBC Personal Loan
MoneySmart Exclusive: As low as 3.7% p.a. interest rate + S$0 processing fee + $108 Cashback
Online Promo: Min. loan repayment of 1 year to the max. of 7 years
Online Promo: *E.I.R: Effective Interest Rate of 7.00% p.a. is applicable for all loan tenors
If you are a foreigner in Singapore who’s looking to kick-start your business idea with some funding, the HSBC Personal Loan is an excellent point to start. Unlike other banks, which may require very high minimum income requirements on foreign lenders, HSBC’s income requirement is just S$40,000 per annum. That’s within grasp for many PMETs here. You will also require an Employment Pass with a minimum of one year validity to apply.
If you are commission-based or self-employed, HSBC also gives it to you. You will need to show evidence of at least S$40,000 a year in income.
With an HSBC Personal Loan, you can borrow up to four times your monthly income, capped at S$100,000. (Special allowance for those earning S$120,000 a year and up to eight times your monthly payment, capped at S$200,000.)
Overall, HSBC Personal Loan is a good option for small business owners as it boasts one of the most inexpensive interest rates in Singapore and the longest loan tenure of up to seven (7) years.
HSBC’s personal loan interest rates are assured when you apply through MoneySmart, so you need not worry if you have a less-than-stellar credit score from past mistakes. You can get in-principle approval for your loan within 1 minute.
Standard Chartered CashOne
Online Promo: Get 50% cashback on your 1st month’s instalment + $199 Cashback!
Online Promo: Instant cash disbursement + $20 cash back!
Online Promo: *E.I.R: Effective Interest Rate of 8.04% p.a. based on three (3) Year loan tenure
Online Promo: Min. loan repayment of one (1) year to Max. five (5) years
Standard Chartered’s personal loan product, CashOne, has a lower-than-usual income requirement for locals. You just need to be earning S$20,000 yearly to qualify for this loan, so it’s great for low-income earners who want to start their own company. For foreigners, the income qualification is S$60,000.
If you qualify, you can borrow up to four (4) times your monthly income, capped at S$250,000. It’s hassle-free, too: You can get your loan immediately approved & disbursed to any bank account (no need to set up a StanChart bank account).
Standard chartered personal loan interest rates are also assured for customers who apply through MoneySmart. Be assured that your credit score will not result in a sky-high interest rate.
Citibank Quick Cash
MoneySmart Exclusive: 3.99% p.a. is only valid for three (3) years loan tenor and min. loan amount of $20k
Online Promo: Min. loan repayment of (1) year to Max. five (5) years
Online Promo: *E.I.R: Effective Interest Rate of 8.50% p.a. based on three (3) Year loan tenure
If you are new to Citibank, you can enjoy preferential interest rates on Citibank personal loans, exclusively on MoneySmart.
To get the preferential interest rate, you will require to borrow at least S$20,000. We would not approve borrowing more than you need, but this amount is fair for those who are planning to kick off their small companies.
To pass for a Citibank personal loan, you need to be earning at least S$30,000 p.a. (Singaporeans/PRs) or S$42,000 (foreigners).
The maximum you can borrow is four (4) times your monthly salary, and you can choose a loan period of up to five (5) years.
When applying for Citibank personal loan, you will need to set up a Citi deposit account if you don’t have one already. Your funds will go in there. You can apply for both products in the same form, and the cash will be in within two (2) to five (5) working days.
Get Approved From The Comfort Of Your Office
In every company, cash flow is essential.
It makes no variation how much money the business makes will generate in two years if it doesn’t have sufficient funds to get by.
Employees need to get paid. Landlords will ask for rent. And if not taken advantage of quickly enough, They can miss market opportunities.
Complete the form underneath to receive a free loan appraisal and learn the maximum amount you can borrow – at today’s lowest interest rates.
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About FR Capital
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.