The application process:
- Filling up of the application form:
The application form must be filled with relevant information about the applicant and their business to apply for the loan. Certain eligibility is required over here to qualify for the loan, which is why this step is necessary. The borrower can request a call back here.
- Uploading the required documents:
Certain documents are required to confirm the details of the application form filled. These documents are to be uploaded by the applicant.
- Submission of the application form and documents:
The documents and application form is to be submitted by the applicant. If a call back is requested, a call will be received by the applicant within 24 hours for an instant SME loan. And they will be told if their application for the loan has been processed and approved.
- Receiving funds:
After the approval of the form has taken place, the applicant can sign the form so as to provide proof that they understand and acknowledge all the terms and conditions on the form. They will then receive their payment.
Eligibility is required by the applicant to qualify for the loan. But what are the requirements? Why is eligibility needed?
- The person applying for the Singapore business loan is required to be a business owner in the first place to apply, to ensure that no one else is going to take it and use it for bad purposes without returning it. A huge amount of money in the wrong hands can cause disasters! Of course, this means that the chance of getting interested or even getting the loan paid back by them is pretty low.
- The business should be at least a year old or more to ensure that no one would start a business for the sake of it, and then take a huge business loan and use it on illegal activities.
- The applicant should also have a good credit score. Unlike a personal loan, a business loan gives a much amount, so it is necessary for the applicant to have a decent credit score so that they could pay back the loan.
- There are various bank loans and loan firms with varying other requirements asked, but all of the above eligibility requirements are the basic requirements for all of them.
Misconceptions about business loans to be aware of:
The reason why business loans exist is not so that businesses could eventually go into unplayable debt that would pile up over the years. It’s so that one could give their company numerous new opportunities that they won’t be able to otherwise, like getting a chance to expand and increase locations, buying newer, better equipment, enhancing the product quality, etc. So many great companies have been in-depth before, so it’s nothing to be ashamed of. Every company has had their good times and their bad times where money is concerned. Running a business is not easy after all! So no one would expect a business owner to breeze through it, and it is completely fine if you can’t. Even some of the best business owners have had problems and have had tough situations and circumstances to deal with.
Sometimes even a small amount of money could make a company bounce right back up if it made the correct investments. That’s the importance of a chance. Before business loans were available, could you imagine what a business owner would have to go through to get a decent sum of money to save their business? People without a godfather to support in these sort of situations have gambled, borrowed from multiple friends and family members, struggled with small bank loans that weren’t enough, or even had to compromise on their own products and facilities. Now, it has been made easy for business owners by allowing them the opportunity to secure a loan.
Reasons for a business loan:
A business loan is used for various reasons by business owners for:
- Getting better working capital:
To start up a business, it takes a lot of money to purchase equipment, acquire workspaces. A lot of expenses come with the starting of a business, making working capital vital.
- Expanding the business:
This includes getting more branches in different locations to reach out to even more people. Or getting more stores or getting into more stores. This could mean getting more employees to work and cater to growing demand. Or expanding more office floors to provide and reach out to more customers.
- Buying better equipment and facilities:
Better equipment can be brought to reduce the cost of making the product. And better facilities can become available for the workers, especially if they are dealing with any toxic or hazardous materials. These additions could not only be cost-effective in the long run but also make things safer for workers and increase production speed, saving a lot of time and being able to provide for more customers.
- Enhancing the product:
The money could be used to do RND or Research And Development on products to make them better and more effective. This could also significantly drive down the price of the product and increase the demands.
- To Avoid Missions out on business offers:
There could be a once in a lifetime business opportunity that seems a little too good to be true, like workspaces being sold for a fraction of the price, or high-quality machines being on sale, or securing a good business deal with another company.
- When Unexpected Expenses Occur:
In businesses, there are often unexpected expenses with things that business owners might have missed out on in their plans like maintenance of equipment or huge electricity bills, etc.
- Stocking up on inventory:
Some excess inventory is always recommended to be kept in case of emergencies where the stock might sell out, especially before certain occasions when it sells out even faster. One should never wait until the last moment before stocking up and should always do so in advance so that customers aren’t lost during the time it takes to manufacture. But stocking up on inventory can be expensive, making a loan important.