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Funding Societies Lending Platform - Review for SME Borrowers

Best platform for small and medium-sized enterprises (SMEs) to find loans to grow their businesses, as well as for investors seeking to invest online using P2P/Crowdfunding.

Funding Societies Lending Platform - Review for SME Borrowers

Best platform for small and medium-sized enterprises (SMEs) to find loans to grow their businesses, as well as for investors seeking to invest online using P2P/Crowdfunding.

5.0/5.0

ValueChampion Rating ValueChampion Icon

Pros

  • 2 min application, 24 hours to receive decision
  • Disbursement in 24 hours
  • No early repayment fee, pro-rated interest

Cons

  • Not the best for loan tenors longer than 1 year

Funding Societies offers great financing options to SMEs that might not meet traditional banks' requirements. It is particularly unique as it offers the one of the largest available term loans ($2,000,000) and the fastest financing option for SMEs (cash within 1 business day). It also offers competitive SME Business loans, which are great short-term financing options for borrowers that do not qualify for traditional bank loans.

Summary of Funding Societies Crowdfunding Lending Platform
One of the largest platforms in Singapore, with more than $3.51 billion in business loans
Less operational history required compared to banks
Lower revenue requirement compared to banks
Among the fastest cash disbursements available (24 hours)

Table of Contents

What Makes Funding Societies Financing Stand Out to SME Borrowers

Funding Societies offers a suite of SME financing: SME Business/Working Capital Loans, Elevate credit card for growing businesses, and the incredibly quick Funding Societies Micro Loans. While Funding Societies Micro Loans is best for borrowers that require cash as soon as possible, the Elevate credit card makes sense for SMEs that require a credit line and a convenient way to track your spending. Its SME business loan is an excellent short to mid-term financing option, which allows companies to keep up with daily operation cash needs or grow their business.

Borrowers may also be encouraged by the volume of Funding Societies' deals. Since 2015, the platform has provided loans totaling more than S$3.5 billion (as of Jul. 2022). This indicates availability of a significant amount of funding and investors interested in lending to SMEs, which could potentially help small businesses receive their loans more quickly.

Downsides to Funding Societies include early repayment fees (dependent on a case-by-case basis) on the outstanding principal for term loans, unlike KapitalBoost, which does not charge an early repayment fee. Do note that Funding Societies' Micro Loans do not charge early repayment fees, however. It also features shorter loan durations than CoAssets (3 years) and several banks (3-5 years).

FeatureSecured Term LoansUnsecured Term LoansInvoice FinancingMicro Loans
Financing AmountS$50,000 - S$2,000,000S$50,000 - S$1,500,00080% of invoice value S$5,000 - S$1,000,000S$3,000 - S$100,000
Average Interest Rates6.5 - 10% p.a.9 - 18% p.a.0.6 - 1.2% per month1-4% per month
Duration1 - 12 months (renewable)1 - 12 months (renewable)Up to 120 days1 - 12 months
CollateralSecuredNone, director(s) personal guarantee requiredInvoice from local businessNone
Origination Feefrom 0.8%2 - 5%1 - 7%3 - 7%
Early Repayment FeeCase-by-case basisCase-by-case basisNoneNone

Who Can Borrow: Eligibility Criteria

Borrowers seeking business loans or invoice financing must have operational histories of at least one year and annual revenue of at least S$300,000. Traditional banks tend to require multiple years of operational history and more than twice as much annual revenue compared to Funding Societies. This makes Funding Societies' products great alternatives for younger and smaller companies that might not qualify for bank loans. Funding Societies Micro Loans features the easiest application process, which does not feature minimum operational history or revenue requirements.

  • All Singapore incorporated companies with at least 30% local shareholding
  • Operating history of at least 1 year (not required for Funding Societies Micro Loans)
  • Annual revenue of at least S$300,000 (not required for Funding Societies Micro Loans)

How to Apply: Application Process

Funding Societies has a simple and free application process, especially for its Funding Societies Micro Loans, which has an application process that takes 2 minutes. The application and approval process for business loans typically lasts for 4 to 5 business days. For the Elevate Credit Card, businesses must have a minimum 30% local shareholding, as well as at least 6 months minimum operating history. Upon approval and activation, funds will be made available via the app for spending online.

For business loans, the financial and operational requirements are similar to financing platforms and less stringent than traditional banks. Borrowers seeking business loans must submit financial statements indicating operating history of more than 12 months and annual revenue of at least S$300,000. In comparison, bank requirements tend to be at least twice as much. SMEs seeking business loans through Funding Societies must provide a personal guarantor's NRIC, credit information, and proof of residential address.

Business Term LoansElevate Credit CardMicro Loans
Operational History Required1 year+6 months+6 months+
Revenue RequirementS$300,000NoneNone
Application FeeNoneNoneNone
Approval4 - 5 business days24 hours2 hours
Receive cashAs soon as 24 hours after successful crowdfundingN.A. (Credit line)Within 1 business day

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Stephen Lee

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.