Clementi Moneylender | Synergy Credit
Business & Working Capital Loan
How to grow your business with a working capital loan
Building a business from scratch can be both exciting and daunting. Here at Bukit Timah Licensed Moneylender, we understand that the path of entrepreneurship can be both challenging and risky especially if you are building a business with zero funding. If you are a business owner looking to kickstart or expand your business, this article is for you.
It is important for companies to have a steady stream of funding especially for small businesses and startups. The Covid-19 pandemic has imparted a tough lesson on businesses that no matter how big or small an industry is, it can never be evergreen or free from risk. Even the toughest of sectors like the aviation industry can be hit by a global pandemic no matter how prepared you think you are. The key takeaway from this pandemic is also the importance of cash flow and liquidity to tide through unforeseen circumstances.
What is a working capital loan?
A working capital loan is generally used as a short-term business financing solution for costs that are incurred on a regular basis such as rent, salaries, and loan repayments. There are also variable costs such as deposits, marketing, investments or paying suppliers and vendors that may require temporary funding from time to time.
Businesses can apply for a working capital loan for a range of business needs as stated above, unlike other more restrictive business loans. They can also use the loan to bridge cashflow gaps for capital-intensive projects, adapting to a new product or service, or hiring more staff in lieu of expanding their business.
At Bukit Timah Licensed Moneylender, businesses may borrow up to SGD 300,000 for our working capital loan with competitive interest rates from as low as 4% per month. The loan amount, loan period and interest rates may vary and is subject to approval.
How a working capital loan can benefit your business
As with any loan, it is important to know the benefits and potential disadvantages when taking out a working capital loan. It is also important to find a financial institution or service that can offer you a loan with competitive interest rates and loan terms that you can meet within your means.
Here are some benefits and potential disadvantages you should consider before applying for a working capital loan:
- Boost cash flow
- Additional funding to take on capital-intensive projects
- Bridge revenue gaps
- Train and hire more staff
- Fund more purchases and fulfil business orders
- No collateral required
- Pay back the loan in full with interest
- Credit rating might be compromised if you are late on repayments
Who is eligible for a working capital loan?
Before applying for a working capital loan, businesses should consider the different eligibility criteria of different financial institutions such as banks and moneylenders. Criteria such as your company revenue and history may be taken into account depending on which financial institution you borrow from.
At Bukit Timah Licensed Moneylender, your company should meet the following criteria to qualify for a loan:
- Be incorporated in Singapore for a minimum of 2 years
- Have at least 30% Singaporean / Permanent Resident shareholding
- Have an existing corporate account with at least 6 months of active transactions
- Have annual sales of less than $100 million and group employment size of 200 or less
Bukit Timah Licensed Moneylender is a licensed moneylender in Singapore that provides credible working capital loans for small businesses. You can contact us here for more details on the application process and other fees.
