A Brief Overview of Bank Loans with Loan Types

Finance

A loan means lending a certain amount of money from banks or any person with a fixed interest. Post-tenure, the money has to be returned with the excess interest amount being added. There are various types of loans like gold loan, car loan, education loan, home loan, etc. SME Bank Loan Singapore is an example of such a loan.

What loans do you want from a Finance Hub?

  • Business security loan: A type of loan of huge sum repaid via monthly payments. Its tenure is within one to five years.
  • SME Microloan: This is typically a government-administered loan for financial purposes. To avail of this offer, the financial company must be having a turnover of 1Million $ or have 10 employees or less. It can be repaid within 4 years.
  • SME Working capital loan: The Company must be having a turnover of $100 Million or may have less than 200 employees. The amount can be credited with 5 years return period.
  • Commercial or Industrial property loan: In this loan, the benefit is more for the loan takers because the interest rate is one of the lowest. Also, the banks do provide the period to repay the loan amount to the companies after inspecting the turnover and ability of repayment.
  • Business Overdraft (OD): An overdraft is just a medium to withdraw money anytime as per your need within the credit limit allowed by the bank. Here, you only need to pay interest if you exceed the overdraft limit. For business security loans, interest is calculated monthly whereas, for OD, interest is calculated daily but debited monthly. The overdraft is used for taking short term loans.

Where and when to apply for an SME Bank loan?

Fundamentally, banks, financial institutions or alternative money lenders are mostly approached for a loan. But the priority will always be the bank for their well-structured rules and regulations regarding money lending and interest calculation.

Criteria, Documents, and Information required to claim the loan

For business loans, most banks will go with specific industries because they cannot withstand the illogical and reasonless withdrawal of huge money. The financial reports also have to be satisfactory. Financial reports, bank statements, existing loan papers, GST forms are mostly required as documents.

With varying interest rates for different types of loans, SME bank loan Singapore remains one of the profound examples of professionalism and appropriateness when it comes to loan services. So, you may approach such banks without any hesitation.

Leave a Reply