THE SME WORKING CAPITAL LOAN SINGAPORE 2024

1. Must be a Singapore registered SME company and at least 1 year in business.
2. Annual turnover of $100K and more.
3. Group employment size of not more than 200 employees. 
4. Minimum 30% shareholding by Singaporean PR.

The maximum small business loan funding amount differs among various banks and also depends on your company credit profile (revenue size, industry, cashflow position etc.).

Most banks’ maximum financing amount granted to SMEs range between $300K to $500K. However, it is exceedingly hard to secure the maximum amount unless the company has close to perfect credit profile. If your main bank is not able to meet your requested financing amount, you can also apply across other banks concurrently to maximize the financing amount you’re targeting.

1. Call and meet our consultants for professional advice.
2. Bring the following supporting documents for the meeting;

• Bank Statement
• Financial Statements
• Personal income tax assessment of owners and directors

The typical turnaround time for SME loan application is 2 to 4 weeks.

The turnaround time takes this long because:

1. You may not be familiar with the documents required and the application process.
2. You may have more back-and-forth communication with the banker to get the financing application right.

If you managed to secure approval after the loan application review, you’ll have to wait for another 1 week for funds to be disbursed. So from application to receiving funds, expect a turnaround time of between 3 to 5 weeks. 

For those who can’t afford to wait, alternative financiers such as P2P crowdfunding platforms is another viable option as they typically process applications faster, within 1 week is the norm. However, be prepared to pay for a higher interest rate or fees compared to bank options. 

Most SME loan applications can be rejected due to multiple reasons, such as:

1. Approaching the wrong banks
2. Business owner’s personal credit profile
3. Limits to financing for existing bankers
4. Weak cash flow

Imagine this scenario: You require funds urgently. Perhaps, to confirm bidding for a tender or seize an opportunity for a big project.

Yet when your SME loan application is declined, you will either have to cancel or postpone this project. Your company’s expansion plan might be stalled due to the missed opportunity.

Moreover, when your application is declined, you might not be able to submit another application to the same bank for the next 6-12 months!

It is critical that you identify the right bank to seek financing with and to be able to address the bank’s credit concerns and queries adequately, to minimize rejections.

There are various working capital loan products available to meet the different requirements of SMEs common SME loan facilities include:

1. Unsecured business term loan
2. Trade financing (Letter of Credit)
3. Invoice Financing / Factoring
4. SME Micro Loan
5. SME Working Capital Loan

How do you cut through the complexity and technical jargon to determine the most appropriate working capital loan to utilize?

Through our expertise and experience in securing SME finance, we describe to you the various financing products in basic terms and explain how you can best utilize them for your business.

There are close to 20 banks & financial institutions (FIs) providing small financing program to SMEs.

Therefore, there is no definite answer to this because different banks have varying credit criteria and risk appetite.

Do you know that some banks shun certain industries whereas other banks might welcome these same industries?

However, most SMEs are not aware which banks are suitable for their respective profile and could waste their precious time speaking with banks that are not the right fit.

Aside from traditional mainstream banks, there are also multiple alternatives financiers offering various financing options to SMEs.

Assisting SMEs with business remains our core business.

Due to our familiarity with the credit criteria of the various banks, we can help identify the most suitable banks for your company’s profile to ensure the highest chances of commercial loan approval at the best terms.

If your personal credit rating is bad, your commercial loan application might be adversely affected. When you apply for an SME loan in Singapore, your personal credit record will usually be assessed by the relevant banks. Your personal credit record will thus affect your company loan approval chances as well. It is absolutely critical as a business owner to keep your personal credit score acceptable. Any negative impairments on your personal credit will adversely affect your business loan applications, making it next to impossible to obtain any form of business financing.

Therefore, always be conscious to protect your personal credit grading by paying all your personal credit cards, home loan, car loan etc. on time. Settle any overdue payments promptly and be cautious not to over-extend your personal credit at all times.

Yes, you can but options are very limited for new startups. Most banks do not provide start-up business loan for newly registered companies.

Most banks lend on track record and would require applicant company to have at least 1 to 2 years of operational business history before considering extending financing.

If your business is operational and at least 6 months old, a competent SME broker might still be able to help you secure business financing.

However, expect very limited financing options for a start for very young companies and also smaller financing quantum. If you manage to secure any form of business loans, ensure prompt subsequent repayments to build up a good credit record for your company.

As your business matures and coupled with a good credit record, it’ll be easier to source for financing in future from more banks, with more options.