Most of the small and the medium enterprises find it difficult to obtain loans mainly due to strict loaning criterions set by the banks and the loan institutions. But finance plays a huge factor in order to grow a business. If you want to get SME loans Singapore, there are various criteria that one has to fulfill. To obtain loans for your startups, here are five easy ways that will surely help you out in the process.
- Understand your requirements– Before applying for SME loans Singapore, it is important to understand why you need the loan. Different owners have different reasons for obtaining loans. So ask yourself why do you need a loan? There can be four possible answers to this question: for starting new business setup, to repay personal loans, to manage everyday expense, for business growth and to keep cash in hand for safety purpose. Knowing the reason is important because this will help you to know how much loan amount will be feasible for you.
- Decide the right loans for you– As mentioned above, the loan that you borrow will depend on one of the above reasons. For startups, the owners may not get a loan in the initial year. There should be continuous flow of cash to support loan repayment and therefore, the startups do not qualify to get loans in the first year. To get SME loans Singapore, the business must have operated for at least 2 or 3 years. Also, it is very uncommon to find startup loans in Singapore. The options for borrowing start up loans are limited.
- Nature of the industry will matter a lot– There are banks that do not offer loans to certain industries for more than one reasons. It can be because of huge default rates or may be because of heavy exposure of credits. If you are rejected for SME Loans Singapore just due to the nature of the industry, there are various other banks that do not consider the industry nature for paying out loans.
- Find the right lender-One can borrow loans from different sources like banks, online lenders etc. You need to determine which lender is right for you. Compare between two or three similar lenders on the basis of terms and the total borrowing cost. If you are eligible for the loan, you need to choose a low APR to continue to repay your loans on time.
- Check if you qualify for the loans– To get SME loans Singapore approved, it is essential to know if you have qualified for the same. This will include the essential information like- your credit history, the time you have been operating in the industry, evaluating how much you will be able to repay your loans on monthly basis and other factors.
After considering all the factors, the next step is to apply for the loan. You will have to submit essential documents to the lender. Make sure that you keep all the documents ready on time.
