As per a Singapore agency, the number of small business loans has been strong in 2018 so far. Recent figures clearly indicate that the number of small business loans will continue to increase by the end of 2019. Increasing interest rate of traditional loans from banks has led to the growth in the demand for other small business funding options. Higher rates of interest from the banks made it more profitable for the businesses to avail other small business funding options.
Why the demand for small business funding will grow?
- The high-interest rate of bank loan is clearly the primary reason behind the growth of the demand for small business funding. As per reports, in November 2017, the rate of approval for lenders in categories such as credit unions, institutional investors and alternative loans (non-banking) rose.
- Regulatory changes in the banking industry boosted the approvals of small business funding options. Changes in some of the rules and regulations of the banking industry such as limitations on trading operations also affected small business funding positively
- Small-scale and large-scale banks are likely to lend money under the current situation where the small business administration altered its equity requirements, especially for commercial real estate loans. Borrowers need not pay more money as equity investment while applying for real estate funding.
- Borrowers have become more confident than before due to the improved performance of the economy. Due to this, the approval percentage of small business funding has gone up this year. The situation is expected to remain the same by 2019.
- Community and regional banks process a big number of small business funding. As per the recent statistics collected by a Singapore agency, the number of small business lending is expected to increase in the coming years. This definitely is a very good news for the small business owners or the start-ups.
- Many businesses with a bad credit are finding it comfortable to avail small business funding as most of the small business funding options can be availed without collateral.
For many other reasons, it is expected that, by 2019, the demand for small business funding will grow tremendously. The availability of a variety of small business funding options gives the borrowers a fair chance of comparison before selecting an option.