Regardless if you’re a seasoned tycoon or a cautious neophyte, you can expect to meet financial challenges (at one point or another) while running your business.
This is especially true if you are operating in a country as highly progressive as Singapore.
Fortunately, this is where a micro loan in Singapore can come in very handy.
What benefits do micro loans offer?
Furniture or fixtures
If you are engaged in the restaurant or retail business, you can use the funds to purchase furniture, décor, and other fixtures your retail space needs.
The money can also be used to buy office fixtures and furniture.
Essentially, it would be advantageous to use micro loans for projects that will improve customer experience and profitability as opposed to just merely enhancing aesthetics.
Inventories or supplies
If you are currently operating a retail business, a micro loan in Singapore can also be used to buy supplies, production materials, and other additional items the business needs.
Many business owners consider this type of loan to be very beneficial as it gives them the opportunity (and the luxury) to increase their profitability.
Machinery or equipment
Manufacturing companies, restaurants, bakeries, and other similar ventures can use micro loans to get their hands on equipment or machinery the business needs.
Those engaged in other lines of business can use the money to buy computers and other IT equipment.
Do you want to hire new employees but you don’t have the necessary funding?
Are you in need of additional capital to fund the company’s day-to-day operations?
Getting a micro loan would be ideal.
Regardless if it’s for essential expenses or other working capital needs, funding provided by micro loans can definitely go a long way.
How do you hasten the approval of your micro loan?
Make sure your credit report is correct.
Before you apply for a micro loan, consider it imperative to check if the figures and information reflected on the credit report are correct.
Check if there are delinquent balances reflected but have already been taken care of.
Also, look for other accounts that might be linked to your name by accident.
Check everything thoroughly to make sure there is nothing reflected in your credit report that can bring your credit score down or can mislead prospective creditors as to your true creditworthiness.
Make sure your financial documents are well prepared.
Understandably, before a micro loan is granted (or any loan for that matter), creditors will have to be certain borrowers would be able to repay the money they owe.
In most cases, you will be required to present financial documents like income statements, balance sheets, and a reconciliation of net worth, among other things to prove you have the capability to settle your obligations.
When preparing your financial documents, make sure they are not more than 90 days old.
If you just started your venture, chances are you will be asked to present your balance sheet as well as your income statement so make sure you have both financial documents handy.
Consider offering collateral or personal guarantee
If you have no collateral to offer, consider offering to sign a personal guarantee instead.
In essence, a personal guarantee gives the lender the permission to seize personal savings, investments, and other assets in case you won’t be able to make the payments agreed upon.
While the setup may seem risky, it’s actually not the case.
Bear in mind that micro loans often only involve minimal amounts so it’s not as risky as signing a guarantee that involves hundreds of thousands of dollars.