If you are wondering where to start your Singapore entrepreneurship or have a business plan in mind but have not saved up enough funds, this article is for you. There is a perfect opportunity to make your seemingly far-fetched idea into a reality.
Start learning about opportunities in marketing with a start-up business loan Singapore. These types of loans offer capital with a minimal interest rate for you to start your dream business, which means that you no longer have to worry about taking large chunks away from your hard-earned savings. Winner right?
What is a startup business loan?
Before we start going deep into the know-hows of this loan, it is necessary that we first give you a general idea of what it is all about. These Singapore business loans are the monetary opportunities with their corresponding interest rate offered by lending companies to business owners. It was created for those who currently do not have enough market or credit history to back their plans of taking out loans for funding their ventures.
This was introduced by the Singaporean government to promote the landscape of small-time ownership, as they have recognized the fact that Singapore is quite a challenging country to open a business in. Being one of the world’s largest marketing industries dominated by big multinational organizations, choosing to also go out and join the battlefield is intimidating. However, they wanted to break such mindsets, hence the introduction of startup business loans with a regulated interest rate scheme that became an inclusive landscape for everyone who wants to try entering the industry.
How do startup business loans work?
Startup business loans work in the same way as when you take a regular Singapore business loan, albeit they have a longer loan tenor that usually lasts from 1 up to 5 years. Unlike personal loans, however, startup business loans consider not just your income but take into account the performance of the business as well. This means that the financing options are based on plenty more factors and on a relatively larger scale than that of personal loans. Financing is also paid regularly, but since these loans have a longer tenor, they are usually paid with a yearly interest.
List of the start-up business loan options in Singapore
There is a wide range of available start-up business loans in Singapore, which can be used as working capital or a capital loan. To know which of these options are most fitting to your needs and preferences, we have summarized relevant information to help you in making your business plan for optimizing your loan amount.
|Product||Maximum Loan Amount ($)||Interest Rates (%)||Loan Tenor|
|Crowdfunding: Invoice Factoring||~80% of |
|1 – 1.7, per month||30 – 120 days|
|Crowdfunding: Unsecured Loan||200 000||12 – 18, p.a.||3 – 24 months|
|First Business Loan||300 000||3.2 – 4.5, p.a.||1 – 5 years|
|Personal Loan |
|12x monthly income||6 – 9, p.a.||1 – 5 years|
|SME Micro Loan||S 100,000||3.5 – 4.5, p.a.||1 – 5 years|
|SME Venture Loan||5 million||2.5 – 11, p.a.||3 – 5 years|
|Startup Loan for Medical Doctors |
|500 000||2.5 – 4.5, p.a.||1 – 5 years|
How can a startup business loan help entrepreneurs?
It may seem counterintuitive to start with a capital loan when you’ve barely worked on your business venture in Singapore, but startup business loans are packed with significant benefits for your financing options. The first of these is the improvement in your business cash flow. Cash flow pertains to the remaining money that a certain establishment has on hand after bills have been paid, basically your on-hand funds.
It is recommended that your current cash flow be able to sustain up to three to six months of the operation to consider the business safe in terms of its liquid assets. Startup business loans help improve this aspect as they provide a different source of funds that can be used by the firm as working capital.
Loan applications also have a given base, interest, and payment mechanism, hence the owner could enhance their financial budgeting as they draft their business plan within the means of their current monetary capacity. Startup business loans in Singapore are extensively discussed by the lender before they are approved, giving the owner the chance to think through the direction with which the venture is supposed to go.
Lastly, getting a startup business loan will help in seizing expansion opportunities especially for those who are just recently considering the thought. With improved cash flow and enhanced financial budgeting, the company can focus on studying the next possible actions that will help increase their profits.
This can lead to actually having the right lens and the needed funds when given opportunities to expand operations, as the owner now has the security of being able to invest more capital while still keeping the current activities in play. Also, it helps improve the credit history of the company when the loan is paid on time, furthering the opportunity for growth of the business later on.
Requirements and eligibility for startup business loan
Before going out and looking for where you can get a startup business loan, it is empirical that you know the requirements and eligibility needed to procure one. We have compiled an easy-to-read list of these necessities that will get you started.
- To be eligible for a loan application, your company should:
- Be registered in Singapore
- Be operational for at least a year
- Have at least $60 000 turnovers.
- To apply, you would need the following documents:
- All of your partners’ or directors’ NRIC
- Recent bank statements from the past 6 months
- Recent financial statements
- Recent income tax assessment notice, both personal and the company’s
- Recent information report (business profile) from the Accounting & Corporate Regulatory Authority (ACRA)
- Recent invoices or business contracts
- Recent utility bills that are under the company’s name
- Additionally, you should also bring the following documents if they apply:
- List of all the assets owned by the company, its directors, and its partners
- Tenancy agreement of the office/shop
How to Improve Your Chances of Getting a Business Loan Approved?
For your loan to get approved quickly, we give you three tips on how to improve your chances. These are quick and easy ways of achieving that approval so you can get started on your business’ next ventures.
Make sure to submit all correct documents and requirements
From our list of requirements above, make sure that what you show to the lending company are the most recent and complete documents. This is to ensure that your business has met the requirements of the loan which can easily be checked by the lender with an organized and complete set of supporting documents.
Clear your debts
The balance to income ratio is a key credit evaluation that the lending company will consider when approving your business loan. This reflects an individual’s capacity to repay debts and will impact the lender’s impression and ultimately their decision of approving a new loan for that person. Clearing your debts will not only increase your chances of approval but will also help in your sorting out your finances in the later run.
Get your Business Loan from Licensed Moneylenders
It is empirical that you apply on legit and licensed moneylenders like Raffles Credit to avoid getting into unfavorable situations that may cost you your business. Singapore is home to an extensive network of money lending companies, and you should pick one that is trusted and secured.
How to find the best startup business loan in Singapore
Now that you have decided to get a start-up business loan here in Singapore, consider sending your loan application to GM Creditz. They offer easy and quick loan application processes that are designed to solve your financial emergencies immediately. Their loans and tenures adhere to the Moneylenders Act and only the imposed and permitted fees and interest rates apply to your plan.
You can get up $200 000 which you and the company can use to achieve greater heights for your business, with regulated interest rates. The application need not involve long lines as their services are available online or via phone call. You will also be immediately scheduled for an in-person consultation, and after getting the agreement approved, you can already receive your money!