Singaporean businesses are facing challenges in securing funding to support their growth and expansion plans. Traditional banks are tightening their lending rules and scrutinizing cash flows, making it harder for businesses to secure funding. However, bridging funding can provide an alternative option for businesses in need of quick cash.
Fast Access to Cash with Bridging Funding
Bridging funding, also known as bridging loans, is a type of short-term financing that provides immediate cash flow to businesses. Bridging loans are designed to “bridge the gap” between the need for cash and the receipt of funds from other sources. These loans are typically secured against a borrower’s assets, such as property or equipment, and can be used to finance a range of business activities, including acquisitions, renovations, or working capital needs.
One of the main advantages of bridging funding is that it can provide fast access to cash. Unlike traditional bank loans, which can take weeks or months to process, bridging loans can be approved and disbursed within days. This can be particularly beneficial for businesses that need to move quickly to secure a deal or complete a purchase.
Flexible Repayment Terms with Bridging Funding
Another advantage of bridging funding is that it can be more flexible than traditional bank loans. Bridging lenders typically have fewer restrictions on the use of funds and may be willing to lend to businesses that have been turned down by traditional lenders. In addition, bridging lenders often have more flexible repayment terms, which can allow businesses to repay the loan in a shorter timeframe than traditional bank loans.
Value of Assets Over Cash Flow
Bridging funding can also be a good option for businesses that have valuable assets to leverage but limited cash flow. When applying for a traditional bank loan, a borrower’s cash flow and credit history are often the primary factors considered by lenders. However, when applying for a bridging loan, the value of the assets being used as collateral is typically the main consideration. This can make bridging funding a viable option for businesses that may not meet the strict cash flow requirements of traditional lenders.
Recent News about SVB Bank
Recent news about the collapse of SVB bank has added to the challenges businesses in Singapore face when it comes to securing funding. Many banks are now shying away from lending due to the current rise in interest rates and increased scrutiny on cash flow. They are looking for strong cash flow and established credit histories, making it even harder for businesses to secure funding.
Choosing a Reputable Lender for Bridging Funding
When considering bridging funding, it’s important for businesses to carefully evaluate their options and choose a reputable lender. There are many bridging lenders in Singapore, and it’s important to do your research to find a lender that can provide the financing you need at a fair price. Look for a lender with a track record of success and a clear understanding of your business and its unique needs.
In summary, bridging funding can provide an alternative option for Singapore businesses in need of quick cash. With fast access to financing, flexible repayment terms, and a focus on assets rather than cash flow, bridging funding can be a viable solution for businesses that may not meet the strict requirements of traditional lenders. However, with the recent news about the collapse of SVB bank and the current rise in interest rates, it’s crucial to carefully evaluate your options and choose a reputable lender to ensure that you are getting the best financing for your business needs.