Guide to Best Small Business / SME Loans in Singapore (2022)

You're a struggling small business or SME (small-to-medium enterprise) owner, and you're looking to improve cash flow with a loan. What are the options? Let's cover the small business loan options in Singapore, and what you can do if you do not qualify for an SME loan.

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What are the Business Loan Options in Singapore?

Business loans are an umbrella term to describe any kind of loan offered to a company for business purposes. There are actually many types of business loans: Some are just offered for whatever business needs you might have (such as for managing cash flow, or for furthering your growth), while others are offered specifically for certain business needs (such as machinery/equipment or property loans) or even types of businesses (start-ups). The most common types are covered below.

Business Loan

The "standard" business loan is an unsecured loan (meaning you do not offer any of your assets as collateral). You then choose a repayment term of up to 5 years to pay it off. All major banks such as DBS, OCBC and UOB offer this to local businesses, but there may be certain requirements such as how long your business has been around, and how much revenue it makes.

SME Working Capital Loan

This is a special type of business loan that's offered to local SMEs (max. 200 employees). The Singapore government works with banks to offer financing of up to $1 million per borrower, to be repaid within 1 to 5 years. The SME Working Capital Loan is available to Singapore-registered SMEs that are at least 30% owned by Singaporeans/PRs.

Temporary Bridging Loan

Another government-backed business financing scheme to help tide all businesses (not just SMEs) over the Covid-19 outbreak. This is open to Singapore-registered companies that are at least 30% owned by locals. The loan amount can be up to $5 million, and repayment period of up to 5 years.

Startup Business Loan

Sometimes called a "first business loan", the startup business loan is a mini version of the regular business loan, offering a smaller cap of, say, up to $100,000. It is considerably easier to get a startup business loan, as you only need to be in operation for a few months and do not need a strong financial history to borrow.

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Why Might Your Business Loan Be Unsuccessful?

As you can see, there are many types of business loans available to SMEs in Singapore, and the government has even stepped in to ensure that funding is available to more small businesses. However, your business loan application may still be unsuccessful - and you will typically only find out after applying for the loan and waiting 2 weeks for it to get processed. Here are some possible "problem areas" when you are trying to secure a business loan:

Track Record

Getting a business loan if you have a fledgling business can be really tricky. Providers typically require your business be around for at least 6 months to qualify. Even if you are established, they may require proof of your annual revenue to lend to you. So if you are only just starting out, it may be difficult to get a business loan.

Business Ownership

Government-assisted financing is open only to businesses registered in (and present in) Singapore, who are at least 30% owned by Singaporeans/PRs. If you do not have enough Singaporean/PR shareholders, you may find it harder to secure a business loan.

Credit Score

Business loan providers can also choose to deny your loan if you have a poor credit score. A low credit score causes banks to doubt your ability to repay your loan. And yes! Your personal credit score does impact the results even if it's for a business loan.

Personal Loans for Small Businesses in Singapore (2022)

If you are unsuccessful or do not qualify for a small business loan, you may consider getting a personal loan instead. A personal loan has somewhat more relaxed requirements; however, the loan amount is also much, much smaller - for example, 4 times of your current salary. Therefore, personal loans are best suited to salaried workers who are looking to start their own side businesses and don't need much to kick it off with.

Business Loans vs Personal Loans in Singapore

Business LoanPersonal Loan
Loan AmountUp to S$20 millionUp to 4X monthly salary
Loan PeriodUp to 5 yearsUp to 7 years
Documents RequiredACRA records, business financial reports, etc.Personal salary records
Business Age RequirementMin. 6 months, some require min. 2 yearsNone
Processing Time2 weeks or moreWithin a few days

Standard Chartered CashOne

MoneySmart Exclusive
Receive cash in 15 mins!
MoneySmart Exclusive
Receive cash in 15 mins!

Standard Chartered CashOne

Interest Rate*
3.48%
Total Amount Payable
S$11,044
Processing Fee
S$0
Per Month
S$307

Receive your loan as quick as 15 mins and enjoy up to S$4,899 worth of free gifts from MoneySmart AND cashback from Standard Chartered! Get your hands on an Apple iPhone 14 Pro Max (worth S$1,799) AND up to S$3,100 Cashback this November! T&Cs apply.

Valid until 15 Dec 2022

Standard Chartered's personal loan product, CashOne, has a lower-than-usual income requirement for locals. You just need to be earning S$20,000 annually to qualify for this loan, so it's great for low income earners who want to start their own business. For foreigners, the income requirement is S$60,000.

If you qualify, you can borrow up to 4 times your monthly income, capped at S$250,000. It's hassle-free too: You can get your loan instantly approved and disbursed to any bank account (no need to set up a StanChart bank account).

Standard Chartered personal loan interest rates are also guaranteed for customers who apply through MoneySmart. Be assured that your credit score will not result in a sky-high interest rate.

Citibank Quick Cash

MoneySmart Exclusive
Zero Processing Fee
MoneySmart Exclusive
Zero Processing Fee

Citi Quick Cash (New Loan Customers)

Interest Rate*
3.45%
Total Amount Payable
S$11,035
Processing Fee
S$0
Per Month
S$307

Receive a range of gifts from an Google Pixel 7 Smartphone (worth S$999) OR an Apple iPad 10.2-inch Wi-Fi 64GB (worth S$499) OR up to S$550 when your Citi Quick Cash personal loan application is approved! Simply apply with MyInfo for a faster journey to your gift! T&Cs apply.

Valid until 31 Dec 2022

To qualify for a Citibank personal loan, you need to be earning at least S$30,000 p.a. (Singaporeans/PRs) or S$42,000 (foreigners).

The maximum you can borrow is 4 times your monthly salary, and you can choose a loan period of up to 5 years.

When applying for Citibank personal loan, you will need to set up a Citi deposit account, if you don't have one already. Your funds will go in there. You can apply for both products in the same form, and the cash will be in within 2 to 5 working days.

UOB Personal Loan

Online Promo
Online Promo

UOB Personal Loan

Interest Rate*
3.4%
Total Amount Payable
S$11,020
Processing Fee
0%
Per Month
S$306
Online Promo:
Enjoy a low interest rate of 3.4% p.a. (EIR from 6.36% p.a.) AND up to S$3,288 Cashback from UOB when you apply for a minimum loan amount of S$10,000 with a minimum tenure of 24 months.  T&Cs apply.
Valid until 31 Dec 2022

Standard Chartered SME Loans

With various types of loans for SMEs, Standard Chartered’s Business Instalment Loan, SME WCL (jointly offered by Enterprise Singapore) and TBL have a first year annual fee that is a maximum 2% of your approved loan amount (minimum S$400). If you decide to have a longer loan tenure, then the annual fee for the subsequent years will be $100 each year. You can even choose repayment periods between 12 to 60 months to cater to the needs of your business.

Standard Chartered Business Instalment Loan

What you can expect:

  • Up to 11% of interest rate
  • Up to $300,000 of maximum loan amount
  • Up to 1 year - 3 years loan tenure

Standard Chartered SME Working Capital Loan(WCL)

What you can expect:

  • Interest rate varies and depends on loan amount (You may contact SCB’s loan officer for preferred interest rates)
  • Up to $3,000,000 of maximum loan amount
  • Up to 1 year - 5 years loan tenure

Standard Chartered Temporary Bridging Loan for SMEs (TBL)

What you can expect:

  • Interest rate varies and depends on loan amount (You may contact SCB’s loan officer for preferred interest rates)
  • Up to $20,000,000 of maximum loan amount
  • Up to 1 year - 5 years loan tenure

DBS SME Loans

The variety of SME loans by DBS cater to a wider range of business owners’ financial needs, ranging from smaller loan amounts of $100,000 to bigger loans of $20,000,000. The good thing about their loans is that there aren’t any annual fee charges, but there’s a minimum of $500 processing fee.

DBS Business Term Loan

What you can expect:

  • Up to 11% of interest rate
  • Up to $800,000 of maximum loan amount
  • 1 year - 5 years loan tenure

DBS SME Working Capital Loan

What you can expect:

  • Up to 7% of interest rate
  • Up to $300,000 of maximum loan amount
  • 1 year - 5 years loan tenure

DBS SME Micro Loan

What you can expect:

  • Up to 7% of interest rate
  • Up to $100,000 of maximum loan amount
  • 1 year - 4 years loan tenure

UOB SME Loans

Similar to most banks, UOB’s maximum loan tenure for its SME loans is 5 years. If you’re looking for lower interest rates, UOB’s temporary bridging loan (jointly offered by Enterprise Singapore) is known for its competitive rates and this loan’s availability has been extended until the end of September 2022. Annual fees for UOB’s SME loans tend to be higher than other banks like Standard Chartered and DBS, as it can be up to $500, depending on the type of loan you take on.

UOB Temporary Bridging Loan

What you can expect:

  • Interest rate from 2.75% (Interest rate depends on loan amount)
  • Up to $1,000,000 of maximum loan amount
  • 1 year - 5 years loan tenure

UOB SME Working Capital Loan

What you can expect:

  • Interest rate varies and depends on loan amount (You may contact UOB’s loan officer for preferred interest rates)
  • Up to $300,000 of maximum loan amount
  • 1 year - 5 years loan tenure

UOB BizMoney Loan

What you can expect:

  • Up to 10.88% of interest rate
  • Up to $350,000 of maximum loan amount
  • 1 year - 5 years loan tenure

Requirements to Apply For A SME Business Loan

Ownership or local shareholding

Some banks or loan providers require a certain percentage of shareholders to be Singaporean citizens or PRs in order to qualify for the SME business loan. This is also part of the responsibility for the banks or loan providers to abide by the regulations of the Ministry of Law of Singapore that a company must be “at least 30% owned by Singapore Citizens and/or Permanent Residents”.

Incorporation of a SME

Most of the SME business loans cater to companies which are registered in Singapore, physically present and operating in Singapore as well.

Annual sales or annual income

Annual sales requirements for loans vary from provider to provider. Although there are some private loan providers that have a lower annual sales requirement of at least $500,000, most government-backed loans have the limit that the annual sales should not exceed $100 million in order to qualify for the loan. As for annual income, some loans like the Standard Chartered CashOne Loan need a minimum annual income of $20,000, while others like the Citi Quick Cash need a higher annual income of at least $30,000.

Employment size

Similar to annual sales requirements, the group employment size required for each loan is different. Some like those offered by DBS and Enterprise Singapore need about 200 or fewer, while others do not have any minimum or maximum numbers.

Operating duration of the business

Most businesses need to be operating for at least the past 6 months before being eligible for any SME business loans.

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How To Apply For A SME Business Loan

Before you start applying for any business loans, you’ve got to be really sure of why you need to take up that loan i.e. extra funds for business expansion, to help to ease cash flow issues or for unexpected emergencies. Picking a manageable loan amount that you can afford to pay off monthly is important to keep your business going and to have a healthy P&L statement as well. Here are 4 simple steps to apply for an SME Business loan to get you started.

Step 1

Visit MoneySmart’s SME Loans page

Simply click on the “Apply Now” buttons above after selecting the preferred bank loan or you can choose to apply via the respective banks’ mobile apps or their websites with your SingPass MyInfo. The bank will then retrieve your identity and income data from SingPass (which is already verified).

Step 2

Get ready all required documentation

You’ll need to provide all the necessary documentation in order for the bank to approve your SME business loan application. This list of documents include:

  • NRIC or other identification details of sole proprietors, partners, principals, and directors
  • Your company’s Goods and Services Tax statements for the past 12 months
  • Your company’s operating bank current account statements for the past 6 month
  • Any required business banking facility forms issued by the bank (to be filled up)
  • Completed Enterprise Singapore Enterprise Financing Scheme (EFS) application form (if applicable)
  • Copy of sole proprietors’ or partners’ Income Tax Notice of Assessment
  • Your company’s board of directors’ resolution
  • Your company’s constitutional documents e.g. memorandum, articles of association
  • Any professional certificate (if applicable) documents related to the establishment of entity, identity and proof of business address documents

Step 3

Select your loan tenure and financing amount

Decide on your required loan amount and tenure before picking the suitable plan and also the preferred account to receive your funds, or provide the details of your other bank accounts.

Step 4

Get your loan approved with quick disbursement

The loan disbursement will be completed upon approval of your SME business loan application, and the bank will send you a notification as you receive the funds in your preferred bank account.

Frequently Asked Questions

What are the documents required to apply for a business loan?

If you are applying for a regular business loan with a bank, you will need to furnish documents to prove your business track record. For example, your financial statements/reports, bank statements, GST declaration and so on. Banks may want to see these records from an extended period (e.g. the last 2 years) as well. If applying for a government-backed business loan such as the SME Working Capital Loan, you may need to show proof of your company's ownership, such as ACRA records. A startup business loan, however, requires fewer business documentation (sometimes no documents at all). And with a personal loan, you need only furnish your personal income documents, NRIC/FIN and work pass and that's it.

How long is the business loan application processing time?

Business loans typically take about 2 weeks or so to process, since there is a large amount of paperwork for the provider to go through. This is understandable as business loans tend to be quite large, and lenders want to be confident that they are lending to the right people. During troubled economic times, banks may also get a high volume of loan applications, resulting in even longer processing times. With a personal loan, however, you can get instant approval and the funds disbursed in your bank account within days.

Can I get loan to start a business?

If you have not started your business yet, you will not be able to get a business loan. Even for startup business loans, you will typically need to be a registered/operational business for at least 6 months to qualify. You can choose to register your business anyway and start operations on a small scale for 6 months before attempting to apply for a small business loan. If you are severely cash-strapped, you may consider applying for a personal loan to start your business. However, be sure that your business plan is functional enough that you will be able to afford the monthly repayments. Otherwise, the repayments will have to come out of your own pocket!