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How can you get an unsecured business term loan in Singapore?

Applying for an unsecured business term loan online
Applying for an unsecured business term loan online

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Need to raise funds urgently to kickstart your new business venture, turn your struggling small business around or ease your small business’ cash flow problems for the short term? An unsecured business term loan might just be what you’re looking for.

What is an unsecured business term loan?

An unsecured business term loan is a business term loan that does not require the borrower to pledge any collateral such as security or asset (personal or business) against the loan funding. The borrower will then make loan repayments over the agreed loan tenure via installments.

So is an unsecured business term loan really collateral-free? The short answer is yes, but for some bank loans, you may need an eligible loan guarantor to support the loan.

Benefits of unsecured business term loan

Unsecured business term loans are highly attractive to small and medium-sized businesses that are looking to raise working capital. As it is highly flexible in nature, an unsecured business term loan can be used for anything from easing cash flow and expanding operations to increasing inventory and headcount or even upgrading equipment.

An unsecured business term loan is attainable for many businesses and you can get full disbursement of funds once your loan is approved. This is a huge perk for businesses that need to raise urgent capital within a short span of time.

Who can apply?

Different unsecured business term loans have different criteria. For example, one bank may offer non-government-backed loans to businesses that are locally incorporated for at least 2 years and have at least 30% ownership by Singaporeans/ Singapore PRs while another bank may require businesses to be locally incorporated for a minimum of 3 years, have a minimum turnover of $750,000 and at least 50% local shareholding.

Licensed money lenders may offer unsecured business term loans to businesses as long as they are registered with ACRA, have been in operation for the past 6 months, and have a director who is a Singaporean/ Singapore PR, or a foreigner residing in Singapore.

Depending where you get the loan from, the requirements can differ vastly.

Where can you get an unsecured business term loan in Singapore?

Major banks (e.g. DBS, UOB, OCBC, Standard Chartered Bank) and financial institutions (e.g. Hong Leong Finance, Singapura Finance) in Singapore offer unsecured business term loans to business owners. Licensed money lenders (e.g. MM Credit) are an option, too.

Check out more places you can get your unsecured business term loan from!

How to improve your chances of getting the loan approved?

Regardless of whether you are looking to borrow from traditional banks, financial institutions or licensed money lenders, having a spotless credit report with a good credit score will help improve your chances of getting loans approved. This is why it’s important that you always make it a point to pay your credit card bills and loans on time consistently.

Your earning and loan repayment capacity will also be taken into consideration.

With banks, your personal credit score may affect your loan approval even if you’re applying for a business loan.

When you apply for a loan with licensed money lenders, they will need to submit all relevant information to the Moneylenders Credit Bureau (MLCB) to do a quick check on your borrowing limit, existing outstanding loan principal amount with other money lenders, total payable amount, repayment records, etc.

When it comes to unsecured business term loans in particular, having a great track record will help increase your chances of getting your loan approved — this means ensuring that your business has a healthy annual revenue and that your business is sustainable.

How to apply for an unsecured business term loan with a licensed money lender in Singapore

The best thing about borrowing from a licensed money lender in Singapore is that the loan application process is a lot easier and faster than at a bank or financial institution. You can get the loan approved within a week!

Here are the steps to apply:

  1. Head over to the licensed money lender’s website
  2. Submit in your personal details and loan amount required
  3. Wait for your loan quote and a call from the loan officer
  4. Make an appointment with the loan officer at the licensed money lender’s registered business address, bringing along all your required documents
  5. Wait for a second call from the money lender (if any) for any pending verifications
  6. Within a week, the loan officer will inform you if your loan is approved and you need to head down to the office to sign the loan contract
  7. Understand the loan contract, loan repayment schedule, fees and charges fully
  8. Sign the loan contract
  9. Get your funds disbursed to you either in cash or bank transfer

And the best part is, you can apply for your loan online anywhere at anytime for 24/7. Super convenient!

Key documents required:

  1. Last 6 months’ bank statements
  2. Last 2 years’ financial statements
  3. Company Constitution
  4. Major shareholders’ and directors’ ICs and NOA
  5. Credit report from Credit Bureau Singapore
  6. Company’s bizfile
  7. Tenancy agreement

What are the interest rates, fees, and charges with licensed money lenders?

Licensed money lenders in Singapore typically charge an interest rate that ranges from 1% – 4% per month as well as late interest of up to 4% per month for each month the loan is repaid late. In addition, a late repayment fee of up to $60 applies for each month of late repayment.

How to apply for an unsecured business term loan?

MM Credit makes the loan application process seamless, quick and easy for anyone and everyone, including you.

All it takes to start the ball rolling is just a few clicks. Simply reach out to us now to get your loan quote.

 

Disclaimer

The information contained on this website is not intended as a substitute for advice from a licensed professional. We do not guarantee the accuracy, completeness, suitability, or validity of any information provided on this website. We will not be responsible for any errors or omissions on the site nor will we be liable for any loss or damage caused by reliance on any information obtained through this website.

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