One of the hardest parts of running a business is funding it. To help cover everyday expenses, companies can consider taking up a working capital loan.
These are either government-assisted or in-housed bank loans.
How it works:
- You receive a lump-sum cash upfront, payable over 3 to 5 years, depending on the loan agreement
- Every month, you pay your loan installment via GIRO or fund transfer
Example:
Based on a loan of $100,000, your monthly commitment can be as low as $1933, payable over 5 years. Click here to see a detailed loan schedule.
Government assisted loan has a maximum limit of S$500,000 from 1 October 2022 – 31 March 2023.
You can consider taking an in-house bank loan should you require a loan more than this amount.
Loan can be stretched to a maximum of 5 years.
Bank usually assess how much bank can loan based on the monthly installment.
Hence, a longer loan tenure usually qualifies the borrower a larger loan amount.
Interest rate varies depending on the lenders's cost of financing and financial profile of the borrower.
Typically, it ranges from 3% to 4% (simple interest) or 6% to 8% (effective rate) for government-assisted and 4% to 5% (simple interest) or 8% to 10% (effective rate) for in-housed loans.
Borrowers of government-assisted loans enjoy the flexibility to early redeem their loans with no penalty fees.
Interests will be prorated.
Greater savings!
Risk share is at 50%. Young enterprises2 may receive a risk share of 70%.
Who can apply:
Documents required to apply:
How long does it take to approve?
Feel free to leave us a message and we will get back to you for a chat at no cost and obligation to you.
