Banks will most surely be the first port of call for most SMEs when it comes to financing.
Banks have well-structured and organized credit lending functions. They give almost all forms of SME financing tools.
There are numerous banks with SME presence locally:
Aside from the 3 local banks OCBC, DBS, UOB and, many foreign banks active in SME financing in Singapore include:
RHB, Standard Chartered Bank, Citibank, HSBC, Maybank, and many others.
All banks have different credit criteria.
Interest rates, financing quantum & terms vary across these banks as well. It would be reasonable to compare all bank products as broadly as possible.
Business loans from banks are the most affordable the cheapest financing option. However, securing approval is tough and can be a long strenuous process for numerous SMEs.
Due to the observed higher risk and default rate in SME lending, most banks’ credit assessment is stringent and robust.
Banks do not broadcast their SME loan application approval rates. From a 2015 study led by Visa and Deloitte, it was found that 40% of SMEs do not have any banking assistance.
If your business has sound financials, healthy cash flow, and planned to wait few weeks to a month on the assessment process, business loans from banks would be the best choice.
Credit image: https://ibusinessloan.sg/