Buiness Loan Malaysia
Buiness Loan Malaysia
To get the best business loan in Malaysia which totally fit your business needs, there are few factors to be considerate. Before we get in deeper to this topic, we need to understand the reason behind our business loan. Besides that, we can actually find some islamic loan for bumi puteri such as pinjaman wang berlesen Melayu with slightly lower interest rate.
4 Topics Before Applying Business Loan In Malaysia
There are 4 major topics you need to understand before taking business loan. After knowing this, I am sure you are good to go.
Business loan is for the purpose of financing the business. It allows the business has sufficient cash flow for the operation itself, for business expansion or purchasing asset. One very crucial point is to use the fund to grow the company into better condition. However, every business loan comes with a cost, which is interest rate that incurred.
Get Yourself Business Loan
To get business loan Malaysia, it is simple but there are still a lot of people got no idea of where to get a business loan that is suitable for their current business condition. Therefore, we will lead you to a journey of choosing the right business loan Malaysia. To help your business in choosing the right loan, you have to understand the following subject.
- Type of Loan
- Interest rate what to know
- Which to choose
- The magic of refinancing
Topic to go through
In Malaysia, you can get business loan from different parties which include
3. profit or non-profit organization,
4. venture capitalist
5. angel investor
6. licensed money lender
7. friend and family.
Please take note, loan can be named with different title when it is offer by different parties. For example, some bank or government might call it as SME loan, small business loan, small business financing, bumi equity financing and many more. Some might call it as grant or startup fund.
It depends on how you see it as, but you can consider all these as loan or financing method. However, grant is a source of financing which might not require the applicant to repay the amount, as long as you achieve what you have promised during the application (Learn more about grant).
all these names are sometimes confusing, but as long as you pay more attention to their detail, you will realize they are roughly the same. The differences would always be the repayment tenure, interest rate, and application eligibility of your business.
Some other loan can be known as fund which is specifically designed to help certain entrepreneur or to encourage certain people to venture into new business. For example, some banks or venture capitalist offer fund that provides loan to new startup with extremely low interest rate.
Type of Business Loan
Term loan – usually involved in larger amount, and the repayment is based on a monthly basis with a specific repayment period.
Short term loan – This is also known as working capital loan, which specifically to help businesses that needs cash flow the most like manufacturing and retail industry. It helps boost up their cash flow to finance their business when it comes to seasonal sales cycle. For example, factory that produce paper or people that own gift shop with multiple outlets.
Note: Short-Term loan can be categorized into
1. Bank overdraft
2. Revolving credit
This is mostly offer by banks to domestic and international trading companies (export and import businesses). The facility includes letter of credit, shipping guarantee, bank guarantee, trust receipt, documentary collection, trade credit insurance, and others. In short, this is where bank acts as a financial intermediary to safe guard the transaction.
For buyer can obtain a business loan Malaysia from the bank by submitting the purchase order and some sort of supporting documents which proves the transaction with the seller, then the bank will finance this transaction and make the payment directly to the seller once the stock is arrived at a certain place.
Alternative for Financing
Besides that, there are other types of loan small businesses may consider. For instance, personal loan, credit card cash advances, loan from friends and family, fundraising, or selling assets. However, the only differences of all these are only the interest rate incurred, the repayment period, and the requirement.
Interest rate what to know
Business Loan, Personal Loan, Grant from government or non-governmental bodies, private loan from friends and family. Which of them provide the best interest rate? Guess what, our topic is business loan Malaysia, but it does not provide the lowest interest rate definitely. Compare to personal loan which the interest rate ranges from 3.80% to 24%, business loan comes with an average interest of only 5%.
Why business loan
is not the lowest interest rate provider? Because there are grants and some other funds given by government, non-governmental bodies, venture capitalist angel investor, and your friends and family. All these might be interest free to your business, if you’ve got a very good business plan. Some of these parties like angel investors meant to help potential entrepreneur to succeed.
However, all these loan, grant or funding are not an easy task unless you meet their requirement. Therefore, licensed money lender exists with offer very flexible requirement to finance your business.
Which Business Loan to Choose
To make the right choice of which business loan Malaysia to take, no one knows then answer than yourself. Choosing the right business loan, a few metrics have to be in your mind which is the interest rate, how soon you need the loan, the repayment period, credibility, type of loan available, and the risk of your business.
Spend more time to Google a bit on the loan facility provided by our various banks other organization, compare their interest rate, eligibility, and repayment period as offered. If you are too tiring of search across, we have prepared a list at below over all the banks or other organizations that provide loan facility to ease your research. For your information, it takes time to get the loan if your document is not sufficient or credibility is slightly weak.
Public bank, smebank, maybank, rhb bank, hong leong bank, ocbc bank, Citibank, standard chartered bank, hsbc bank,
If you are too tired of doing your own research, and you are looking for quick cash to finance your business; and you don’t mind go for some licensed money lender, we may give you a hand. Contact us, so that we can help you source for some advises
The magic of refinancing
We will cover this for our next topic. To teach you how to lower down your loan interest rate by going through refinancing, when the bank negara reduces the interest rate.