Funding Societies Lending Platform - Review for SME Borrowers

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 well as for investors seeking to invest online using P2P/Crowdfunding.

Good for

  • SMEs with immediate financing needs
  • SMEs with a limited operational or financial history

Bad for

  • SMEs that require business loans with durations of longer than 1 year

Editor's Rating

5.0/5.0

Funding Societies offers great financing options to SMEs that might not meet traditional banks' requirements. It is particularly unique as it offers the largest available P2P invoice financing loan ($1,000,000) 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 Lending Platform
One of the largest P2P/Crowdfunding platforms in Singapore with over 2,100 deals totalling more than S$110 million
Less operational history required compared to banks
Lower revenue requirement compared to banks
Among the fastest cash disbursements available

Table of Contents

What Makes Funding Societies Stand Out to SME Borrowers

Funding Societies offers a suite of SME financing: SME Business/Working Capital Loans, Invoice Financing, and the incredibly quick FS Bolt loan. While FS Bolt is best for borrowers that require cash as soon as possible, invoice financing makes sense for SMEs that have a significant amount of invoices/accounts receivable and require short-term financing in the meantime. 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 completed over 3,000 deals totalling more than S$145 million. 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 of 2% on the outstanding principal for business loans, unlike KapitalBoost, which does not charge an early repayment fee. It also features shorter loan durations than CoAssets (3 years) and several banks (3-5 years).

FeatureBusiness LoansInvoice FinancingFS Bolt
Financing AmountS$50,000 - S$1,500,00080% of invoice value up to S$1,000,000S$3,000 - S$50,000
Average Interest Rates9 - 14% p.a.0.75 - 1.25% per month2 - 6% per month
Duration1 - 12 monthsUp to 120 days1 - 12 months
CollateralNone, director(s) personal guarantee requiredInvoice from local businessNone
Service Fee3 - 5%2 - 4%3 - 5%
Early Repayment FeeSubject to 2% on outstanding principalNoneNone

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. FS Bolt 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 FS Bolt)
  • Annual revenue of at least S$300,000 (not required for FS Bolt)

How to Apply: Application Process

Funding Societies has a simple and free application process, especially for its FS Bolt loan, 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 first-time borrowers the invoice financing application and approval process takes 3 to 7 business days, with subsequent invoice financing application processes lasting only 1 to 2 business days.

For business loans and invoice financing, the financial and operational requirements are similar to most P2P lending platforms and less stringent than traditional banks. Borrowers seeking business loans or invoice financing 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. Additionally, Funding Societies requires invoices from domestic companies for borrowers applying for invoice financing.

Business LoansInvoice FinancingFS Bolt
Operational History Required1 year+1 year+None
Revenue RequirementS$300,000S$300,000None
Application FeeNoneNoneNone
Approval4 - 5 business days1 - 7 business days2 hours
Receive cashAs soon as 24 hours after successful crowdfundingAs soon as 24 hours after successful crowdfundingWithin 1 business day

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