In Singapore, it can be challenging to set up your business without acquiring a business loan for it. Yet, every year, a high percentage of business loans are rejected as they do not fulfil the eligibility criteria. If you have recently had your business loan rejected, we’re here to improve your chances of obtaining a business loan in Singapore.
Here are a few ways you can improve your chances of getting an instant cash loan for your business in Singapore.
1. Build an excellent credit score
When you are borrowing cash from banks or other reliable money lenders in Singapore, your credit score and history will go through a strict inspection. If you have an excellent credit score, it shows that you are capable of making timely repayments to the licensed moneylenders. Banks and licensed moneylenders are unlikely to lend money to someone who has displayed a trend of not making timely payments in the past.
By maintaining an excellent credit score, financial institutions like licensed moneylenders will be able to quickly approve your loan as they would consider it less risky to lend funds to you.
2. Clear and achievable business plan
Before your business loan is approved, bank officials will analyse the clarity of your business plan. If you do not disclose enough details of your business plan, reliable money lenders may not approve of your business loan. You should plan out an achievable and realistic business plan that is targeted towards the goals of your business.
Ensure that you present the cash flow of your business along with the tenure when repaying your debt. When you list all of the above factors in your loan application, you can portray yourself as someone who is capable of making the most of the borrowed funds.
3. Apply at the right time
If there is no consistency in the financial outcomes of your business, for instance, having a huge profit in the first year and followed by a considerable loss in the second year, banking institutes and licensed moneylenders might brand your business as volatile. Most licensed moneylenders are most likely to approve loans to businesses when they appear stable and strong in their finances.
You should make plans ahead of time and secure loans even if you may not need them at the current moment. If you have experienced consistent six months of profits, then you should apply for a business loan while your track record looks its best.
4. Apply for the right loan
Business loans can come in various types, and if you do not have a complete understanding of it, you may end up choosing the wrong product. Although the primary aim of the loan is used to fund your business, their terms and conditions may differ slightly. The repayment patterns and the collateral that you will have to keep against the business loans also vary. Thus, you should ensure that the loan you select can cater to the financial needs of your business.
Getting a business loan is a crucial step in ensuring that your business can get set up in Singapore. You should follow the ways listed above to get your business loan approved and ensure that you submit all of the required documents.
Most importantly, keeping an excellent credit score can boost your impression to licensed moneylenders, further improving your chances of getting a business loan in Singapore.