Working Capital Loan | When Should You Get One & How to Get Approved?

All successful businesses you have seen today were once small-to-medium enterprises (SMEs) that require a working capital loan to operate. But look at them now. They have been successfully running their business, and it seems like they never went through any hardship.

That could also happen to you as long as your SME has enough working capital loan that fills the gap and helps you operate your business. That is why you should not shy away from taking this option. It is an opportunity that you could use to strengthen, expand, and solve your business needs.

Therefore, if you have plans to get one for your business, here are the things you need to know.

What Is a Working Capital Loan?

The difference between working capital loans and other kinds of debts is that the former is for businesses.

As you know, running a business is not that easy, especially if you lack money to support its needs. That is why some SMEs rely on getting a working capital loan. They can use this fund to take care of their short-term operational needs. As such, they will be able to operate their business more efficiently.

When Should You Get a Working Capital Loan?

As mentioned above, an SME can only use a working capital loan for their business needs. They use that fund to pay for almost anything as long as it is within this bracket.

In short, you cannot use this debt for other purposes like buying a car, house, etc.

To give you a clear image of when an SME should use and get a working capital loan, here are some best times that they most likely need one.


This situation often happens for several reasons. One of which is when a client does not pay their request or invoice on time. Or when the inventory turnover of your business takes a long time to go through. Well, regardless of the reason, a poor cash flow can negatively affect your business operation.

That is why instead of waiting for invoices and turnover to process, be proactive. Take out a working capital loan so your business operation will not get disrupted.


Not all products get sold all year round. Some sell more during the first quarter of the year, while others are more demanding before the year ends. And all of these happens due to changes in social norms, interests, and needs.

A good example is our current situation. The COVID-19 cost everyone to use personal protective equipment to protect themselves from virus transmission when going out. That is why those businesses that sell these products are gaining more profits and sales than other industries.


It happens when a product suddenly gets in demand. When a new business sells that product, chances are they cannot satisfy the request of their customers. And that is what unprepared growth spurts are, which can lead to bankruptcy if not handled well.

To prevent that, those SMEs who are going through growth spurts should get a working capital loan. Doing so should help them produce more products and meet the customers’ demand at the same time.

When in doubt whether your SME can apply for a working capital loan, it is best to ask a money lender in Singapore. They can give you a complete list when you can get one.

How to Apply and Get Approved?

Since you have not applied for a working capital loan before, chances are you have no idea what you should do. Therefore, let this article show the things you need to consider so your application will be successful.


Before you can complete filling out your loan application, you should figure out how much money you need. Note that a legal money lender can only lend you a certain amount suitable for your business needs.


Once you know the amount you need, it is time to determine what type of loan you should get. Just in case you didn’t know, there are several types of working capital loans such as:

  • Invoice Financing.
  • Equipment
  • Credit Line
  • Purchase Order Financing

Make sure before you choose any of these types, you should create a proposal on how your SME will use the working capital loan once approved.


In SG, if you need money, you can ask a lender or moneylender to lend you the fund you need. But before you can do so, they will ask the rate of your credit score first. This information will help them know if you are trustworthy enough to lend.

That is why you should make sure to get a copy of your credit score before you submit your working capital loan application.


The less to no debt you have, the higher your chances of getting approved. Therefore, make sure you already pay off any debt you had in the past.


Besides filling out the working capital loan application, you would also need to compile several documents. If you can submit all of the papers, it will be much faster to review your loan request. Listed below are some of the files often needed.

  • Tax Returns
  • Government-Issued IDs (Driver’s License and State ID.)
  • Credit Card Statements
  • Bank Statements
  • Pay Stubs       


You have to since any missing information or typo can negatively affect your loan application. That is why it is necessary to double-check everything file by file.

Where Should an SME Get a Working Capital Loan?

Finding the best money lender in Singapore can be just as challenging as deciding whether your SME should get a working capital loan or not. Luckily,  you do not have to search for long since Apply Loan SG got you covered.

Not only do they offer a variety of SME working capital loans, but they are also in partnership with several licensed moneylenders. In other words, you can assure that the fund you will get is good money.

If you need funds for your business right now, talk to their legal money lender in Singapore. All you need to do is fill out their online loan application on their website.