Different Types of Business Loans in Singapore

Generally speaking, business loans are designed to provide funding for a business to go through a rough patch or to expand further and boost their sales volume. If you are looking for the best business loans in Singapore, then you’re in luck. Singapore business loans are now simplified. With some support and guidance, you can now quickly and easily find affordable business loans, which are certainly going to come in handy to meet your business financing needs.

However, it is a good idea to learn about the different business loan options in Singapore before you make a decision. Each type of business loan in Singapore has its own features, so here’s a list of the different types of business loans in Singapore to help you make an informed decision.

Unsecured Business Term Loan

This is the most conventional type of business loan. A term loan is offered over an extended period of time (usually up to 5 years or even longer). A business term loan is usually a good choice if you are looking to purchase assets that are sure to generate income over time, provided that return is higher than the loan itself. Whenever the overall return is higher, the loan is worth it.

Asset Financing

Asset financing is another type of business loan that is commonly used to purchase fixed assets. These loans are normally secured against the asset that is being purchased.

Invoice Financing /Receivables Financing

Cash flow can be a very tricky issue for many businesses. Your clients or customers may pay for products and services at an unpredictable rate. That’s why some lenders are willing to provide cash in exchange for a share of outstanding invoices. The borrower is required to give up a certain percentage of the outstanding invoice amount, but if the cash flow is particularly low, this business loan can be a great option for you. In some cases, the lender will even offer to recover the unpaid invoice amount on your behalf.

Trade Financing

Businesses which manufacture goods or trade products face certain challenges when starting new ventures. Suppliers will require certain guarantees that contracts will be paid in full, but payments for the end products might release long after the project is completed. Providers can offer trade financing, usually in the form of guarantees to your suppliers. This can help your business to overcome the issue of how to pay for supplies & find a good business loan in Singapore.

SME Micro Loans

Banks and other financing institutions might be reluctant to offers loans to small businesses since, in their view, the risk involved is more than the amount of money expected. However, there are many private providers who are willing to offer micro loans to such businesses. Such micro loans can help your business to overcome cash flow challenges or to fund stock or equipment purchase. The fact that lenders offer unsecured loans and ensure a simple application process is another major advantage.

Equipment Financing

Equipment financing enables SMEs to buy important pieces of equipment that are vital for the business on lease or hire purchase. This enables them to overcome cash flow challenges to ensure the smooth running of the business.

Property Loan

Businesses can guarantee their property held for working capital to grow their business. A type of secured loan, the interest rate is particularly very cheap for property loans.

How to Apply

There are numerous types of business loans in Singapore and the best one will be the one that suits your needs and offers a low interest rate. If you want to compare all of your business loan options, https://loanowl.sg offers a list of loans that are ideal for business owners.

All the recommendations are thoroughly researched and listed based on the provider’s market scope and reputation as well as the rates and requirements of business owners, so you can make the best decision for your business.