Best banks for startup and small business loans in Singapore (2026)

Best banks for small business loans in Singapore in 2026

1. DBS Business Loan

• Max Loan Amount: Up to SGD $500,000
• Tenure: Up to 5 years
• Indicative Interest Rates: From around 7% p.a.
• Eligibility: Singapore-registered company; typically needs a minimum operating history
• Highlights:

• Fast, digital-first application process
• Often part of the DBS Business Starter Bundle
• Flexible for established SMEs with solid cash flows

2. UOB BizMoney Loan

• Max Loan Amount: Typically up to SGD $350,000, but can reach SGD $800,000 with bundled government-assisted schemes
• Tenure: 1–5 years
• Indicative Interest Rates: 7.5% – 10.88% p.a.
• Eligibility:
  
  • Business registered and operating in Singapore
  • Usually, a minimum of 1 year of operations
  • Includes sole proprietorships, partnerships, and private limited companies
• Highlights:
  
  • Option to bundle with government initiatives (e.g., co-funding schemes)
  • Flexible uses, including working capital

3. OCBC Business Loans

OCBC offers multiple products tailored to different business needs:

OCBC Business First Loan

• Max Loan Amount: Up to SGD $100,000
• Tenure: Up to 5 years
• Indicative Interest Rate: ~8% – 11% p.a.
• Eligibility: Startups (from ~6 months of operations), Singaporean/PR ownership conditions
• Best For: Early-stage SMEs looking for smaller financing

OCBC Business Term Loan / Working Capital Loan

• Max Loan Amount: Up to SGD $700,000
• Tenure: Up to 5 years
• Interest Rates: ~7% – 11% p.a.
• Eligibility:
  
  • Locally incorporated
  • At least 2 years of operations
  • Minimum Singaporean/PR ownership percentage (often 30%)
• Best For: More established companies needing larger amounts

4. Standard Chartered Business Instalment Loan

• Max Loan Amount: Up to SGD $500,000
• Tenure: 1–5 years
• Indicative Interest Rate: Around 9% p.a.
• Eligibility:
  
  • Singapore-registered business
  • Typically ~3 years operating history
  • Minimum turnover (e.g., SGD $750,000)
  • At least 50% local shareholding (Singaporean/PR)
• Best For: Larger SMEs with steady revenue

5. CIMB BizGrow Loan

• Max Loan Amount: Up to SGD $400,000
• Indicative Interest Rate: ~9.88% p.a.
• Highlights:
  
  • Targeted at SMEs seeking growth capital
  • Competitive mid-range borrowing option

6. ANEXT Bank SME Loan

• Max Loan Amount: Up to SGD $500,000
• Positioning: Digital-native bank focusing on SME banking needs
• Highlights:
  
  • More flexible digital approval
  • Tailored specifically to small business borrowers

Comparison summary: Key differences

Notes: Rates, loan amounts, and eligibility criteria are indicative and subject to change. Final terms depend on credit assessment and bank discretion.

Advantages of Bank Loans:

Here are some reasons why bank loans can be a practical financing option.

1. Multiple loan options

All banks offer different types of business loans depending on the purpose of borrowing. For example, banks offer various schemes if you are setting up a business and/or already running one.

2. Cost-effective

When comparing interest rates, bank loans are usually the cheapest option compared to credit cards. Some bank loans charge interest rates of 7% to 11% per annum, compared to credit cards, which charge 25% to 28% per annum.

Lower interest rates on bank loans will definitely help your business save money. However, the interest rate is not the only fee that might be charged. It is recommended to check the bank's early/late repayment fee and processing fee.

3. Flexibility

Banks generally don’t require day-to-day reporting, but loan agreements may restrict how funds are used. With bank loans, you only need to worry about making your regular instalment payments on time. For that reason, you have full flexibility in how you use the amount.

4. Retained profits

Banks are only interested in receiving the principal and interest on a loan. Banks will not ask for the profits that you make. In contrast, for loans from angel investors or VCs there will be an agreed amount of shares that will be given to the lenders from the profit that you make.

Despite the advantages that bank loans offer, there are also some downsides when your small business takes a loan from banks.

Disadvantages of bank loans:

Though not many, business bank loans have a few disadvantages. Here are some:

1. Strict requirements

Besides the better option for lower interest rates, banks are also known to have a long list of conditions and requirements that your business should fulfil before you can get the loan. It is sometimes hard or even impossible to meet all of them. 

While most bank loans require some form of collateral, if you're a startup owner, SME or have an existing business without any assets, you may find it difficult to get the loan application approved. Most of the time, if you decide to go for unsecured loans, you will be given higher interest rates.

2. Repayment burden

As mentioned before, there's no agreed amount to be shared from your profits when you get a loan from banks. With banks, you only need to pay the agreed principal and interest amount of your loan. Hence, it's crucial to pay the bank the right amount on time. If you fall behind on paying back the money, you may face the prospect of having your assets seized.

Some banks charge early/late repayment fees every day. Even if you manage to make late payments, your bank could still report you to credit bureaus. If that happens, it will negatively impact your credit score. With a lower credit score, obtaining loans in the future becomes more difficult.

3. Risk of losing collateral

Bank loans generally require some collateral. If you're a small business owner, your house and property are often your home. Hence, there is a risk of losing your collateral if you fail to repay the bank.

What banks consider before approving a business loan

• Revenue and profits: Shows repayment ability.
• Credit history: Business and director credit behaviour matters.
• Cash flow stability: Consistent inflow improves approval chances.
• Business age: Many banks prefer 1–2 years of operations.
• Collateral or guarantees: Often needed for larger loans.

Alternatives to a bank loan

Online lending marketplaces connect your business with lenders based on your financial profile and funding needs. They are fast and convenient, especially if bank loan approval is difficult.

However, they can be costlier. Platform, origination, and broker fees may increase total borrowing cost. Loan terms also vary widely, making comparisons harder.

Watch out for aggressive terms, short repayment periods, and variable pricing. Always review total borrowing cost, repayment flexibility, and lender credibility before choosing.

1. Peer-to-peer lending

These days, many online platforms match your business loan requirements with potential lenders. Basically, you need to post a profile with background information and explain what you need the money for.

2. Merchant Cash Advance Financing

A merchant cash advance (MCA) provides your business with upfront capital in exchange for a fixed percentage of future credit or debit card sales, plus a fee. Repayments are automatically deducted from daily or weekly card transactions rather than paid in fixed monthly instalments.

Unlike bank loans, MCAs aren’t structured around interest rates. Instead, providers charge a factor fee, which can result in very high implied annualised borrowing costs when converted into an effective interest rate. This makes MCAs significantly more expensive than traditional bank financing.

MCAs are typically easier to obtain because they:

• Don't require collateral
• Place less emphasis on credit history
• Rely primarily on card sales volume

However, this convenience comes with notable risks. Because repayments are tied directly to revenue, a large portion of your daily cash inflows may be automatically deducted. This can strain working capital, especially during slower sales periods, and make it difficult to cover operating expenses such as rent, payroll, and supplier payments.

In Singapore, merchant cash advances are also not regulated in the same way as bank loans, and terms can vary widely between providers. Businesses should carefully review fee structures, repayment mechanics, and total repayment amounts before proceeding.

3. Business credit line

A business credit line is a flexible funding option that lets you withdraw funds when needed, rather than taking a full loan upfront. You pay interest only on the amount you use, not the total approved limit.

It is useful for managing short-term expenses such as supplier payments, payroll gaps, and unexpected costs, especially when cash flow fluctuates month to month.

Compared to term loans, credit lines usually have higher interest rates but offer faster access and more repayment flexibility. They work best for working capital and day-to-day operational needs, not long-term investments.

4. Online loans by non-bank providers

Non-bank lenders offer fully digital loan applications with faster approvals and minimal documentation. However, borrowing costs are generally higher.

Conclusion

Your company’s current financial position and expansion goals are important to banks when approving your business loan application. Bank loans are approved if your business is stable and has a consistent income. If you are an early-stage startup, then you can opt for alternative financing. Rather than just looking at interest rates, consider the loan's repayment schedule, your financial readiness, and the loan's terms. Aligning funding decisions with business reality can achieve long-term growth and financial stability.

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