Starting a business is no easy venture. You have a long list of great business ideas, but how feasible are those ideas? Canyour budget/fund sustain your business in the long-run? You must be thinking of funding solutions now. What are your options?In this article, we will tackle the subject of business loans in Singapore – how to apply, what are the requirements, things to consider before applying and more.
What is a Business Loan?
Business Loan is a type of commercial financing, a loan that is a debt-based funding arrangement between a business and a financial institution/organization. Qualified and approved businesses can get this loan from moneylenders, banks and credit associations. The borrowed money or funds are used as working capital to cover and sustain the daily operational costs that the business may otherwise be unable to afford or purchase such assmall to big inventory purchases, daily utility bills, machineries and real estate.
Why are business loans important?
A business needs funds to increase the workforce and operations expansion. Growth and progress requires funds. Business loans provide the flexibility you need for your business growth plans. Business loans can also act as an emergency p fund. A common challenge that businesses face is irregular revenue flow. . A loan can stabilize your cash flow during these times and aid in building a good credit record. These positive habits can help you increase your credit scores and qualify for more financing options. Small business loans can provide the financial assistance your business needs to survive, thrive, and succeed.
How to get a loan for my small business in Singapore?
Most small and medium-sized enterprise (SME) business owners in Singapore will require business financial assistance at some point in their business venture. Here are some tips on what to expect and prepare for your business loan application.
A guide to the application process for a Business Loan
- Submission of application
You may apply online or visit a branch in person. You should prepare the basic information of your business and the appointed directors in your business.
- Document Submission
Prepare documents such as your NRIC or other identification details of sole proprietors, partners, principals, and directors, Goods and Services Tax statements for the past 12 months, Company’s bank account statements for the past 6 month, Specific business banking facility forms issued by the bank, Copy of sole Income Tax Notice of Assessment, Company’s board of directors’ resolution, Company’s constitutional documents e.g. memorandum, articles of association, Professional certificate documents related to the establishment of entity, identity and proof of business address documents.
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- Presentation of Business Loan offerUpon the evaluation of the submitted documents, the bank will present you with the loan amount that they will be able to offer you.
- Loan acceptance
If you are agreeable to the issued loan, you can endorse or accept the loan offer.
Digital banks offer small business loans ranging from S$5,000 – S$300,000 (it depends on the arrangement) and some exempt businesses from the need to declare a collateral. One of the digital banks, ANEXT Bank, offers loans up to S$30,000 without any documents required and offers flexible repayment options.
