DBS SME Loan Review: What Makes the Bank Stand Out?
DBS SME Loan Review: What Makes the Bank Stand Out?
ValueChampion Rating 
Pros
- Great rates for SMEs with strong financial and operational records
- Open to all businesses including companies that don't qualify for government-assisted loans
Cons
- Not the best for businesses with limited experience and revenue
DBS is the largest bank in Singapore and one of the most trusted lenders. It also offers a wide range of business loans with competitive rates and features. If your business requires funding for anything from working capital to funding the purchase of new equipment, this bank may be a good fit for your company.
| Summary of DBS Small Business Loans |
|---|
| Competitive interest rates |
| Wide range of financing options for all types of business |
| Loan Tenures of up to 25 years |
Table of Contents
- What Makes DBS Stand Out to SMEs
- Who Can Borrow: Eligibility Criteria
- Other Charges and Fees
- How to Apply: Application Process
What Makes DBS Stand Out to SMEs
One of the most established lenders in Singapore, DBS offers some of the most competitive rates for its small business loan products. The bank offers 12 different SME financing options ranging from business term loans to equipment financing. This is very helpful for businesses that may benefit from a specific loan (e.g. asset purchase loan) or require to obtain several types of funding. Additionally, while the interest rates for most business loans are highly dependent on the specifics of the prospective borrower, DBS tends to advertise rates that are among the most competitive in Singapore.
Highlights of DBS SME Loans
|
Loan Type | Max. Principal | Interest Rates from | Max. Tenure |
|---|---|---|---|
| Business Term Loan | S$800,000 | 7 - 11% | 5 years |
| SME Working Capital Loan | S$300,000 | 7.00% | 5 years |
| SME Micro Loan | S$100,000 | 7.00% | 4 years |
| Equipment Financing Loan | Up to 90% of equipment price | Unknown | 5 years |
| Business Property Loan | S$1,000,000 | 2.5% | 25 years |
| Local Enterprise Finance Scheme | S$10,000,000 per Borrower or S$20,000,000 per Borrower Group | 4.25% | 1 year |
Despite the advantages of borrowing from DBS, their loans may not be the most suitable options for all businesses. For example, some startups or other new and small businesses may be better off attempting to obtain funding from other lenders, which usually have less strict borrowing requirements. With that said, it may be worthwhile to contact DBS enquire about your eligibility before ruling them out.
Other Charges and Fees
DBS charges a processing fee for each of its business loans. This fee tends to range from S$500 to 2% of the total loan amount. Unlike other lenders, DBS does not typically charge annual fees for its business loans. With that said, you should always carefully check the terms and conditions of your loan to ensure that you understand the fee structure and are prepared for the total cost of your loan.
Who Can Borrow: Eligibility Criteria
While DBS does not publish full eligibility criteria for small business loan applicants on its website, banks typically require that businesses meet a operational history requirement, revenue requirement or both. In order to be eligible for the DBS Business Property Loan, SMEs must own commercial property.
How to Apply: Application Process
- Max Financing
- S$500,000
- Fees
- > of S$500 or 2%
- Interest Rate
- 7% - 11%
- Eligibility
- Be incorporated and operating in Singapore. Have at least 30% local shareholding.
In order to apply for a business loan from DBS, applicants must fill out a form online. This application process can take as little as 5 minutes. The bank's application allows businesses registered with MyInfo Business to enter their CorpPass in order to easily retrieve required business and personal information for the application.
Examples of Required Application Information
- Contact information
- Purpose of the loan
- Existing business debt
- Net income/profit
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Stephen Lee is a Senior Research Analyst at ValueChampion, specializing in insurance. He holds a Bachelor of Arts degree in International Studies from the University of Washington, and his prior work experience include risk management and underwriting for professional liability and specialty insurance at Victor Insurance. Additionally, Stephen is a former US Peace Corps Volunteer in Myanmar (serving between 2018-2020), where he continues to provide business development consulting services to HR companies in Asia Pacific.