If you are a small business or minor to medium business enterprise owner, then you know the struggles of getting a personal loan in Singapore. If you want to keep your business upright and carry on with your business, some other options, namely small business loans, can look upon.
Business Loan Options In Singapore
The collective term ‘Business Loans’ holds all the opportunities a business firm is eligible for when going for Loans. There are many different loans in Singapore, and each of them has relevance in the insurance sector. You can choose according to your need any of the Business Loans you think deems fit for you. The procedure for signing up for a loan is not that difficult, and hence they are often referred to as easy business loan. Every form of business has the option to get something out of these loans. The different types of loans include:
- Business Loan – This is the most basic form of loan which you should know if you have a business in Singapore. The good part of this loan is that it is an unsecured loan, meaning that you do not need to keep anything under the mortgage and can choose a repayment term of almost up to five years. This loan is available in all the central banks of the country. However, in some instances or most cases, you have to produce your business papers in front of the bank, and then only will you be eligible for the loan.
- SME Working Capital Loan – if you have a local business in Singapore with significantly fewer employees, you can opt for this type of loan. Here the Singapore Government, coupled with the Banks, works together to pay One Million Dollars to the local businesses, and you can repay them within a period of one to five years.
- Temporary Bridging Loan – This is another Government based scheme, and this one is for backing the businesses that have suffered a blow in the Covid-19 Pandemic situation. This loan offers almost up to 5 million Dollar loan amount, and you have the repayment time till five years. This loan is open to all Singapore registered companies and is an excellent step to help revive the economy from the severe blow of the Covid-19 Pandemic.
- Startup Business Loan – As we all know, if anything contributes the most to a growing and developing economy, then it is these small businesses and the startups. Hence there are several schemes for startup businesses. They are often referred to as the first business loan, and it is the smaller version of the business loan. They offer a hundred thousand dollars, and you can quickly get a startup business loan if you are in business for a few months. There is no need to have a strong business history if you want to borrow.
A small business loan Singapore has these few types. There are many more to it; however, these are the most basic types and hassle-free types of loans one can consider if they want to borrow. There are many other specialised types that you can look up on the Internet.
Points To Be Noted Before Opting For A Loan
Often and in many cases, there had been the scene that an SME has opted for a business loan and applied for the same but after waiting for two weeks or so have returned disappointed to find out that it has not been approved. To avoid such circumstances, you must be mindful enough and learn about the common problem areas where your application can get rejected. So here is the list for it:
- Track Record – records of your business or the timespan for which you are operational are crucial when it comes to business loans. However, it is shown that any startup can get a loan, and there is a relaxation given for the records to be shown. However, it does not work in that straight manner as such, and you can still see many businesses that are operational for almost a year or two applying for startup loans. Hence, you have to keep in mind that it can be a big challenge to get a loan if you start a business.
- Business Ownership – If you are a foreigner and want to get with your business in Singapore, this is a trigger warning because almost thirty percent of the loan given out is reserved for Singaporeans or Singaporeans living outside Singapore. Hence, if you want to get with your business swiftly, you have to consider enough Singaporean stakeholders to get away with the loans as swiftly as possible. If you are a foreigner and trying alone, then the situation can become complicated.
- Credit Score – Your loan is deemed to get rejected if you have a poor credit score. A poor credit score means doubting your ability to pay back the loan. The personal credit score also impacts borrowing one for your business, and you need to be very particular about it. Any mistakes can lower your chances of borrowing a loan from the Government.
These are a few of the things that becomes a crucial point when considering a business loan, and you can keep these points in mind when you are about to borrow loans for your business in Singapore.
Make sure you can repay your loan. Business is a very unpredictable area, and if you turn out to be a defaulter, you can lose havoc on it. Hence it is always advisable to keep in check and rule out any scopes that can lead you to the point of being a defaulter. Other than this, the Government of Singapore has some excellent facilities for Small Businesses. If you are getting a loan, you are lucky that your business has the correct financial assistance.
It is not that easy to borrow money in the form of a small business loan, but if you get it, then it can be a big step for your small business.