SMEs form the backbone of the Singaporean economy. In fact, as many as 99% of all Singaporean enterprises are SMEs. The Singapore Department of Statistics reports that SMEs provide up to 71% of all employment opportunities. In 2023, they contributed almost $270 billion in nominal value to the economy.
However, running an SME comes with its own set of challenges, chief among them are financial issues. According to a survey conducted by QBE Insurance, in 2023, Singaporean SMEs faced increased operating costs and lower profitability. A large portion also cited a steady flow of funds to cover production and overhead costs as a major stumbling block.
One strategy that can ease the management of operational costs are SME micro loans. These are small, unsecured short term business loans usually between $30,000 to $150,000 in value. They can be used for a multitude of purposes, including but not limited to offsetting overhead costs, starting a new enterprise or funding growth projects within a company.
Micro loans for SMEs have a more flexible eligibility, often dependent on the discernment of the lenders. In general, companies who apply for these loans have to be Singaporean entities with at least 30% stake owned by a Singaporean citizen or permanent resident. They should also be in operation for at least 6 months.
In addition to these basic requirements, enterprises will also be asked to submit several documents to support their micro loan application. These include the latest 6 months bank statements of the business and the Credit Bureau reports for all directors or guarantors. Additionally, you would need to submit a Notice of Assessments (NOAs) for all company directors.
There are, however, certain instances where business owners may not have prepared themselves well and submitting these documents could hurt their application instead. Examples include having low balances or collecting most of their revenues via cash. In these cases, the options for SME micro loans that do not require documents submission might help them with their application.
Several lenders in Singapore offer various forms of SME micro loans that do not mandate the submission of conventional loan application documents. Often, you may be able to apply online using your Myinfo business details via Singpass. These SME micro loans do not require documents submission:
DBS Bank offers working capital loans to borrowers, with financing up to $500,000. However, for loans of up to $50,000, no documents are required, provided that your corporation is new to DBS bank and has never taken any prior loans from them before.
In addition to this special arrangement, DBS is also offering a discount on processing fees for applications submitted online. At present, with this micro loan DBS provides repayment tenors of up to 5 years with interest rates starting from 7% per annum.
Another positive feature of DBS’s working capital loan is that there are no fees levied for early loan repayments. You will only need to notify the bank at least 1 month in advance, by contacting your relationship manager.
Ant International Singapore’s subsidiary, ANEXT Bank is one of the newest digital banks in Singapore to have received a wholesale banking licence from the Monetary Authority of Singapore (MAS). Anext Bank’s main objective is to provide financial services to SMEs, namely startups, micro and small businesses.
Apart from borrowing, SMEs will also be supported in terms of transactions and investments. In terms of business loans, Anext provides collateral-free financing in two different forms, Pay-Per-Use and Pay Monthly.
The Pay-Per-Use model is a revolving line of credit with repayment terms of up to 6 months. With each withdrawal, customers will need to pay a small monthly flat fee until the final month, when the principal is due.
The Pay Monthly model, on the other hand, is a term loan with payment tenors of up to 5 years. SMEs will only receive financing as a one off payment, and will be expected to repay both principal and interests monthly. For both these financing models, businesses can expect to borrow a maximum limit of $300,000 with both loan models.
ANEXT business loans below $30,000 do not require document submission, in line with the bank’s policy of business inclusivity. Business owners will also be able to take advantage of the fact that the minimum loan quantum offered here is just $5,000.
Maybank offers two types of SME financing for business owners, namely Online Business Financing and Personalised Business Financing. Their Online Business Financing can be applied for easily using the bank’s website, and does not require any financial or bank statements. Borrowers can expect to get financing of up to $150,000 without the need for collateral, financial or bank statements. Applications can be done 24 hours a day, using your company’s Myinfo details.
The application process is relatively fast, and existing Maybank customers with complete records can expect to know their application status within about 10 minutes. New-to-bank customers will be notified of their status within 2 days. In terms of disbursement, existing Maybank sole proprietorship business account holders can expect to receive their funds within a few minutes of application approval.
Maribank is a digital bank wholly owned by Sea Limited, which itself is a subsidiary of Temasek Holdings. Maribank offers business loans in the form of a credit line. Applications for this loan if less then S$30,000 do not require document submission. Instead, the bank relies on retrieving your company’s Myinfo Business with Singpass and Shopee during application processing.
Among the benefits of MariBank’s loan is that it is free of any processing and annual fees. They also offer a simple interest rate per month, starting at 0.5% for a 3 month tenor. Customers may choose repayment tenors from 3, 6, 9 or 12 months and enjoy a credit limit of up to $200,000.
Elevate for Business is an online business financial support platform by FS Capital Pte. Ltd. In addition to tracking and managing cash flow, it also allows for seamless automation of the payables and receivables process.
One key aspect of Elevate for Business is that it also provides businesses with access to a credit line. The Elevate Credit Line can be applied for using your Myinfo Business without the need for additional documentation.
Once approved, you will be able to enjoy a credit limit of up to $20,000 and 55 days of interest-free credit. Thereafter, customers will be charged an interest rate of 2.5% on any outstanding amounts, to be brought to the next billing cycle.
Companies often encounter circumstances in which they require more financial room to manoeuvre. This is where document-free financing can be helpful. Whether they are offered as term loans or credit lines, the funds offer business owners the freedom they need to maintain and grow their business.
Lendingpot is a platform that allows you to access business financing in a convenient manner. Simply register with your Myinfo Business, list your business and begin receiving loan offers from lenders. Our unique platform allows you to compare loan terms and conditions at a glance, so you will be able to select the best loan to suit your needs. Do contact us too, if you would like to find out which of our lending partners offer micro loans without the need for document submission.
Lina heads up all things marketing and branding at Lendingpot. With a keen aesthetic eye, she believes in the use of design to communicate with our SME community and aspires to turn Lendingpot into a household name. Out of work, she is an avid camper and appreciator of nature’s best works.
