SME Working Capital Loan
Compare All Banks Options

The maximum SME Working Capital Loan a business is eligible for is up to $500K, subject to credit approval. This can be spread out across different banks, if one single bank is not able to offer up to the maximum $500K (which is usually the case for most SMEs).

A financing consultant can help you navigate and manage applications across multiple banks. Each bank has different credit criteria. 

The maximum SME Working Capital Loan an individual bank can grant to a business differs across various banks' credit criteria, which is not disclosed to public. Common metrics include your business's credit profile (revenue, industry, cash flow position etc.). Revenue would be the main key factor banks use to determine max loan amount.

It is exceedingly hard to secure the maximum amount unless the business has a 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.

There are around 16 banks and financial institution providing SME Working Capital Loans. Their interest rate are different and varies according to factors such as credit profile and age of the applicant business.

SME Working Capital Loan interest rate typically ranges between 4% to 4.6% simple rate p.a. (EIR 7.5%-8.5%). It is also prudent to compare widely through multiple banks to secure the best financing deal.

Do note that the lowest rates quote that you receive might not necessarily mean it’s the best financing offer for your business. Check with the banks on their processing fees and any other fees that could effectively increase your cost of financing.

Alternatively, consider engaging a financing consultant to help comb through the various banks SME Working Capital Loan products to source the lowest rates for your company.

The typical turnaround time for SME Working Capital Loan application is 7 to 10 working days. For cases where credit approvers raise more concerns, might take up to 10 to 20 working days.

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 bank to get the financing application right.

If you manage to secure a loan approval, funds disbursement will take another 5 to 7 working days from date of acceptance. So from application to receiving funds, expect a turnaround time of between 3 to 5 weeks.

The SME Working Capital Loan is a financing program under the Enterprise Singapore Financing Scheme. 

It is a government assisted financing scheme administered by Enterprise Singapore. SMEs can tap onto this financing scheme for their business's working capital needs, business expansion or general standby cash flow.

Enterprise Singapore provides a risk sharing mechanism with participating financial institutions. This is to help improve financing access for SMEs. Applications are still subject to banks' final credit assessment. 

A business term loan is a typical product name that banks offer for SMEs. It works essentially the same as the SME Working Capital Loan, whereby a lump sum loan amount is disbursed to the business for successful applications, and repayments are serviced via monthly instalments over a typical term of 3 to 5 years.

The key difference between the banks' in-house business term loan and the SME Working Capital Loan is usually the early redemption penalty clause. 

For most banks' in-house term loans, they typically bear an early redemption penalty of between 2% to 8%, depending on each banks' product specification and clause. 

The SME Working Capital Loan does not bear any early redemption penalty. This provides SMEs with a flexible exit option should you choose to partially, or fully redeem the loan anytime throughout the loan tenure.

There are close to 16 banks and financial institutions providing SME Working Capital Loan to SMEs.

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

The best banks are those that credit criteria most suits your business's profile. 

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 precious time speaking with banks that are not the right fit.

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

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 highest chances of loan approval at the best terms.

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 opportunity for a 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. Try out our free loan assessment tool to check your indicative eligibility and see best loan options instantly.

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

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 for at least 6 months, a competent SME loan 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 repayment track record, it’ll be easier to source for financing in future from more banks, with more options.