Startup Loans | Lendingpot Singapore

Q: Why is a personal loan the best option for a startup?

Most banks require at least 2 years of business history (track record) before granting a business loan. Even "startup" loans from banks are highly selective and usually require you to already be making money. If you are currently employed, a personal loan can provide much cheaper financing than a business loan, with flexible tenors of up to 5 years.

Q: Can I sell my shares held as collateral during a market move?

No. You cannot sell shares held as collateral until the loan is fully repaid. On the plus side, you continue to own the shares and will still receive all capital gains and dividends during the loan period.

Q: Will there be a margin call for share-backed loans if the market moves?

There are no traditional margin calls for these facilities. However, if the market price of your shares falls so that your collateral no longer covers at least 90% of your loan value, the lender may ask for a cash top-up.

Q: What is the turnaround time for a personal loan application?

For a standard personal loan, the "golden standard" is same-day approval. However, while some banks facilitate instant disbursement, others can take more than 2 weeks, depending on your profile. Share-backed and insurance-backed loans typically take 2–3 weeks, as the legal transfer of shares or assignment of proceeds must be completed before funds are released.

Why Choose Lendingpot for Startup Business Loan In Singapore

Keep Your Personal Savings Safe

We identify the best startup business loan in Singapore that is 100% collateral-free, so you can grow your business without risking your family’s home or emergency fund.

Unlock Cash From Your Personal Assets

If you need lower rates, you can use a startup loan in Singapore backed by your public shares or insurance policies, getting you cash at rates as low as 3% p.a.

Maintain 100% Control

Unlike taking on investors, a startup business loan in Singapore gives you the opportunity you need without forcing you to give away shares or face outside partners.

Check Loan Eligibility

Founder receiving a classic personal loan to fund a startup

Option 1

The Classic Personal Loan

A personal loan is properly defined as a loan that is disbursed into a borrower’s personal bank account. This is not to be mistaken with other loans typically associated with it such as an auto loan or a renovation loan. The two mentioned are loans that are paid directly to the car dealer and contractor and not into the personal bank account. As such, auto loans and renovation loans are not appropriate for business use as there is no flexibility in its usage.

How Does It All Work for the Classic Personal Loan In Singapore

Determine Your Maximum Loan Amount (Quantum)

In Singapore, your funding limit is primarily driven by your annual income. Banks generally serve directors earning above S$30,000, while Licensed Moneylenders (LMLs) fill the gap for lower-income brackets.

Annual Income (S$)

Banks

Licensed Money Lender

Less than 20,000

Max S$3,000

20,000 - 30,000

More than 30,000

More than 40,000

More than 120,000

Check Your Credit Bureau Score (CBS)

Your CBS report is your "financial face" to lenders. A strong score (AA to BB) allows you to borrow more at lower rates.

The 3 "Make-or-Break" Factors in Your Report:

Overall Grade

A score ranging from 1000 to 2000; HH is the worst, while AA is the best.

Negative Records

The presence of past defaults or active bankruptcy will lead to immediate rejection by banks.

Absence of Score

If you have no credit history (graded as "Not Applicable"), banks may hesitate, but LMLs are often still open to lending.

Compare Interest Rates (EIR¹ vs. APR²)

Don't get distracted by "advertised" flat rates. Always look at the Effective Interest Rate (EIR) to see the true cost of the loan.

Banks

Licensed Money Lender

6-8% p.a. (EIR)

1-4% per month

1.5% processing fee

2.5-7% processing fee

¹ The effective interest rate, or EIR, must be stated alongside the advertised rate in Singapore. This includes processing and other costs, as well as the specifics of your repayment plan.

² The yearly interest earned by an amount charged to borrowers or paid to investors is referred to as the annual percentage rate (APR). APR is a percentage that indicates the real annual cost of money for a loan or investment over the period of the loan. This includes any fees or other expenditures incurred throughout the transaction, but does not include compounding.

Pick Your Repayment Period (Tenor)

Your tenor determines how much you pay each month. Choosing a longer tenor reduces your monthly burden but increases total interest paid.

Bank

Up to 5 years

*Offer extended tenors of up to 5 years.

Licensed Money Lender

Up to 24 months

*Generally offer shorter tenors, usually capped at 24 months.

Lendy, the Lendingpot mascot, explaining how startup loans work

Share-backed Financing

3.6% p.a.

Interest Rate

Max 2 years

Tenor

0.5%

Processing Fee

Monthly Principal + Interest

Repayment Schedule

Item

Details

What is it

A way to obtain liquidity from your investment by taking a loan against its value. You will need to custodise the security, making it not tradable during the loan period.

Type of applicable assets

Shares, unit trusts, bonds and money market funds (an open-ended mutual fund that specializes in short-term debt securities).

Loan-to-value (LTV) ratio

Depending on the security type, up to 70% of the assets' market value. The more stable the stock the higher the LTV. For example, if the market value of Share A is $1,000, financing of up to $700 may be offered. Note: Should the LTV at any point exceed 90%, a top up may be required by the lender.

Eligibility

Singaporean and foreigner allowed. Min annual income $100,000 or have $250,000 of transferrable assets. Min age 21.

Benefits

1. Solve short-term cashflow needs while participating in your investment upside (dividends and capital appreciation).
2. Get emergency liquidity on standby for your business needs through an additional cashline.
3. No impact on your long-term wealth planning and financial goals.

Quantum

Min $50,000, or max of up to 2x of your annual income or 2x assets with the loan provider.

Insurance-backed Financing

3.6% p.a.

Interest Rate

Max 2 years

Tenor

0.5%

Processing Fee

Monthly Principal + Interest

Repayment Schedule

Item

Details

What is it

A way to unlock the existing value in your in-force insurance policy without giving up the protection and perks that the policy offers.

Type of applicable assets

This is only applicable to fully paid insurance policies with a surrender value, and which were issued by reputable insurance companies.

Loan-to-value (LTV) ratio

Up to 90% of the latest guaranteed surrender value. However, the final financing amount will depend on the insurance policy’s latest guaranteed surrender value, while the LTV ratio will depend on the type of policy, and the company that issued the policy.

Eligibility

Singaporean and foreigner allowed. Min annual income $100,000 or have $250,000 of transferrable assets. Min age 21.

Benefits

1. You free up liquidity for your cash needs.
2. You can continue to enjoy coverage from your policy without having to surrender it.
3. Reap the benefits when your policy appreciates.
4. You can continue with your wealth planning and long-term financial goals.

Quantum

Min $50,000, or max of up to 2x of your annual income or 2x assets with the loan provider.

Stop Losing Time to Banks and Start Your Business Successfully

Most business owners waste hours comparing loan options across different banks, only to find out they don't qualify. We fix that.

Side-by-Side Comparison

Identify the most cost-effective startup business loan in Singapore through our transparent dashboard.

Talk to our team ›

Founder checking startup loan eligibility with no credit score impact

No Impact On Your Credit Score

Our initial matching process does not affect your personal credit score, allowing you to check eligibility upfront without impact.

Talk to our team ›

Lendingpot consultant explaining success-based startup loan fees

Success-Based Pricing

Our marketplace scan and advisory services are provided at no upfront cost. For business products, a success fee applies only if you accept an offer and receive your funds.

Talk to our team ›

Frequently Asked Questions About Startup Business Loan In Singapore

Have a different question? View all FAQs here

Why is a personal loan the best option for a startup?

Can I sell my shares held as collateral during a market move?

Will there be a margin call for share-backed loans if the market moves?

What is the turnaround time for a personal loan application?

Disclaimer: At Lendingpot, we aim to provide accurate, objective and up-to-date information. The details you see on our site may be different from others. Some content may be compensated through third-party advertisers. However, the results of our comparison tools which are not marked as sponsored are based on objective analysis. All financial products and services are presented without warranty. The list of financial products displayed on this website are not exhaustive.

Lendingpot Private Limited (UEN:201011505E) is a subsidiary of the IFS Capital (UEN: 198700827C) group of companies.

Warning: You have to repay your loans. Don't pay any intermediaries.

Get A Startup Business Loan In Singapore to Scale Your Business Without Risking Your Savings

What is Start Up Business Loan?

Why Choose Lendingpot for Startup Business Loan In Singapore

The Classic Personal Loan

How Does It All Work for the Classic Personal Loan In Singapore