Business Loans

We Compare Business Loans: DBS vs OCBC vs UOB

Eric Koh
July 23, 2018

(Updated in 2020)

Due to the economic challenges caused by the COVID-19 pandemic, the Singapore government has offered various support measures to assist SMEs, including credit support in the form of government-backed business loans.

The aforementioned banks have temporarily suspended the offering of these unsecured business term loans and have replaced them with the government-backed SME Working Capital Loan (EFS-WCL) and Temporary Bridging Loan Programme (TBLP).

Please refer to our latest articles for more information about the current business loan schemes.

Need a business loan?

You took the plunge, quit your job and started your own business. Your brand-new online store selling tea and t-shirts (or food, or a small event management company… you get the idea) is starting to gain traction and your investment in social media marketing seem to be working.

Now it’s time to bring your business to the next level by applying for a loan to expand, buy more supplies or take on bigger projects… and BAM! You’d never have expected it to be so tough borrowing money from the bank

Let’s look at a comparison of the basic business loans (NOT the government-assisted schemes)

Product Name DBS Business Loan OCBC Business Term Loan UOB BizMoney
Max. Loan Amount Up to S$500,000 Up to S$500,000 S$50,000 - S$350,000
Loan Tenor Up to 5 Years Up to 5 Years Up to 4 Years
Interest Rate From 10.88% (EIR) 8.88 - 13.88% (EIR) 8.0 - 12.99% (EIR)
Annual Fee N.A. N.A. S$288 - S$500
Lock-in Period 2 Years
  1. No lock-in (higher interest rate)
  2. 2-year lock-in (lower interest rate)
No information
Early / Prepayment Fee (within lock-in period) 2.5% of principal amount prepaid 2.0% of principal amount prepaid 4.8% flat or any such fee specified by the bank
Cancellation Fee 2.0% of loan amount 2.0% of loan amount 4.8% flat or any such fee specified by the bank
Processing Fee S$500 or 2% of approved loan amount, whichever higher 2% of approved loan amount Min. of S$288 or not more than 2.88% of the approved loan amount
Min. Business Turnover No information No information Min. S$750,000
Min. Years in Business 2 years 2 years 3 years
Secured by Guarantors? Yes Yes Yes

*Information as of 2018*

Our opinions

In our opinion, there are minimal differences between the three local banks.

From our experience, although UOB appears to be the most restrictive in terms of its business loan eligibility requirements, it is the most flexible in practice (read: can be affordable, based on negotiation) in terms of its pricing of fees and interest rates.

So is there any difference between these banks?

The only tangible difference between them is the type of industries that they provide business loans to.

Although not stated explicitly, sometimes, due to risk categorization, some banks may not grant loans to certain “high-risk” industries (i.e. construction, retail, cafés or spas).

However, ordinary business owners will not know what is each bank’s “high-risk industry” flavour of the day.

Tips for small business owners getting a business loan

1. Try getting a loan with another bank (other than your operating account’s bank).

  • Tell them you are also applying with your operating account’s bank.
  • If you are a “new-to-bank” customer, the relationship manager usually works a little harder trying to convert you (here is where you can request for more competitive rates!)

2. If possible, take your time and don’t accept the first set of interest rates/fees.

  • As stated above, the relationship managers have some leeway to offer better rates. No harm asking for a cheaper interest rate (e.g. a 1% reduction of interest rates will save you $1,500 of total interest payable for a 5-year, S$50k loan).
  • This is most likely to work if your business has a strong cash flow.

3. Get a business loan from a marketplace like

  • You get connected to multiple relationship managers at the same time who know they are competing with other banks.
  • In order to win your business, relationship managers are more likely to either compete on price (by offering cheaper interest rates) or improve their service level to win your business.
  • It’s free. No gimmicks. Apply now!

Disclaimer: All the information is believed to be accurate; however, no claims, promises or guarantees about the accuracy, completeness or adequacy of the information are made. All information, commentary, recommendations or statements of opinion provided in this article are for general information purposes only. This article is based on information found exclusively on their respective websites. We believe our information is representative. However if there are any errors in our reporting, please contact for rectification. We do not claim to be authoritative.

Request for a Business Loan Now! operates a Business Loan Marketplace that allows an SME to connect to multiple lenders with just one application, allowing the SME to know who its prospective lenders are and the rates that they offer, in a very short time.

Leading digital loan marketplace Lendingpot connects SMEs to its network of 45 lenders comprising relationship managers from banks, financial institutions, and private and peer-to-peer lenders in Singapore. It aims to help SMEs overcome the information asymmetry problem and lack of transparency prevalent in the SME financing sector by offering SMEs financing options such as business term loans, property loans, revenue-based financing, credit lines, working capital loans, bridging loans, invoice financing, and more.

About the author

Eric Koh is passionate about helping SMEs grow and has spent years interacting with business owners at OCBC and IFS Capital. He is interested in 70s rock ‘n roll, the odd novel and copious amounts of historical trivia.

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