Looking For An SME Loan? Here’s A Guide To Finding The Right Loan
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In a post-pandemic environment, SME owners continue to face challenges including staff shortages, supply chain disruptions, and raw material cost increases. In the midst of rebuilding your business, you are required to maintain resilience, adapt to changes, and grow your company. To achieve your goals, you may require extra funds for hiring, inventory, digital transformation, and others. Whether it’s to increase working capital or expand your company, getting a loan is an important decision that can impact your cash flow and more. 

When applying for a loan, SME owners would perhaps consider a few factors like the loan amount and which bank to apply from. However, there may be other things that you can take into account as well when preparing for your loan application to ensure a smoother journey.  

Here are 4 things you can think about before applying for a SME loan.  

1. Finding out how much you really need

Start by defining the purpose of your loan application. Whether it’s a short- or long-term loan, being clear about how much you really need is important. Otherwise, you might get too big of a loan and run the risk of committing to one that is beyond your affordability. On the other hand, an insufficient loan might cause you to not achieve your objectives. 

Having a specific purpose in mind helps determine the type of financing you need as well. 

If you’re thinking about getting a short-term loan to boost your cash flow for daily operational activities, you can consider getting a working capital loan that provides quick access to financing. 

Or, if you require a long-term loan to open a new factory, you can consider property financing with collateral. Some banks offer property financing that provides up to 90% of your property’s valuation or more. 

2. Simplified and fast application

Loan application process has become easier than ever these days with some financial providers starting to offer fully online services to further convenient customers. With that, SME owners can make quick applications safely anytime from within the comforts of their home or office. 

Applying for a loan can involve a lot of preparations at times including face-to-face meetings and documentations. A simplified loan application process lets you access funding easily and focus on what’s more important – your business. 

In fact, SME owners can now easily apply for financing with Alliance Bank Digital SME online via the RinggitPlus chatbot. You’re only required to furnish one document, which is the latest 6-month bank statement, and Alliance Bank customer service will get back to you with a decision in as fast as 3 working days. 

3. Fulfilling requirements

Depending on which loan you’re applying for, the requirements and documentations will vary. In general, when it comes to fulfilling required criteria, you can look at three aspects:

  • Period of being in operation – to apply for a business loan, your company would usually have to be in operation for at least one to two years with sufficient documents that show your company’s activities and financial situation such as financial statements, legal documents, and tax receipts
  • Establishment – the determination of whether a business qualifies as a SME in Malaysia lies on two qualifying measures namely annual sales turnover and size of company, as stated by SME Corp
  • Healthy cash flow – before approving your loans, banks will evaluate your credit records to check if your business is viable. A healthy cash flow indicates good financial management and repayment ability.  
SectorMicro SMEsSmall SMEsMedium SMEs
ManufacturingAnnual sales turnover < RM300,000

Full time employees < 5
Annual sales turnover < RM15 million

Full time employees < 75
Annual sales turnover < RM50 million

Full time employees < 200
Services & OthersAnnual sales turnover < RM300,000

Full time employees < 5
Annual sales turnover < RM3 million

Full time employees < 30
Annual sales turnover < RM20 million

Full time employees < 75
  • Malaysian-owned – a company that operates and trades in Malaysia must be locally-owned meaning a majority of shareholders must be of Malaysian nationality.

4. Services beyond banking

Amid the current challenging environment, SME owners have diverse needs including adopting technologies, streamlining day-to-day operations, and tapping into new audience pools. 

Alliance Bank is ever ready to support SME owners with a myriad of services on its BizSmart Solution portal. Available for all SME clients, the portal features expert solutions for accounting, payroll, digital marketing, telecommunication, delivery, and training at value prices. 

Through the BizSmart Solution portal, SME owners will also get access to the latest updates in the business world and tips for managing various aspects of their companies.  

Apply with Alliance Bank Digital SME for an easy approval 

Now that you know more about applying for an SME loan, you can consider Alliance Bank as a fast and simple way to access up to RM500,000 collateral-free financing via the RinggitPlus chatbot. 

If your SME has been in operation for at least one year with a minimum annual sales turnover of RM50,000, you may apply for a loan with Alliance Bank Digital SME to enjoy:

  • Simple digital application – apply within a few minutes via the RinggitPlus chatbot on WhatsApp. 
  • Fast approval – only need to furnish a 6-month bank statement to apply and get approval in as quick as 3 working days.
  • Convenient – only one document is required*. Simply upload the latest 6-month bank statement during the application via WhatsApp. For loan amounts below RM200,000, only a virtual interview is required. *Other supporting documents may be required subject to the Bank’s discretion.
  • Mobile banking – full mobile banking services via BizSmart® Mobile app
  • Access to value-added services – Alliance Bank SME customers get access to business   solutions   at   discounted   rates   from  partners such as SQL Malaysia, Celcom, Avana and many others on BizSmart® Solution.

***

Finding the right business loan that suits your needs and capabilities could help you secure the financing that you need. So, when applying for a loan, be sure to take into account all the factors mentioned above such as types of financing, minimum requirements, application process, and more.

Apply for Alliance Digital SME financing for your business here.

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