What is it?
- An Overdraft is a revolving credit facility which provides businesses with a standby credit line.
- It allows you to draw on the amount up to an agreed limit anytime or as required.
- It functions just like a credit card in that interest is charged only when you draw on it and according to the amount drawn.
- The Overdraft credit limit available reduces as it is drawn down.
- The full credit limit is restored once full repayment is made.
- Usually there are no charges if the overdraft unutilized.
How it benefits you?
- Businesses with tight cash flows will benefit from this standby credit line which can be accessed immediately.
- It is an ideal instrument to serve as a reserve for your daily operational funding needs.
- Companies with quick rapid sales turnovers will find Overdrafts as a perfect low cost solution for their credit terms offered to their clients.
- High Overdraft amounts of up to S$300,000.00.
- Usually little or no collateral is required.
- Approvals within 1 or 3 days.
- Upon approval, it takes about 7-21 working days to set up the account.
- Indicative Effective Interest rates of about 12%p.a. to 14%p.a. is computed on the outstanding drawn amount and the overdraft limit that is awarded.
- Some lenders may impose a one-time processing fee of about 1.5% – 1.99% of the approved amount.
- Additional costs may also include an annual fee of about 1.5% of the approved amount.
- Total interest costs can be reduced by repaying the balances as soon as possible.
Who is eligible?
- Suitable For Sole Proprietors, Partnerships, Private Limited Companies.
- Minimum 3 years of business operations.
What you need to apply?
- Photocopies of Sole Proprietors’, Partners’, Principals’ Identity Cards and/or Passports.
- Company’s operating bank current account statements for the past 6 months.