How Corporate Loans Can Help Your Business Cash Flow

Corporate loans are a common financial solution for businesses facing cash flow challenges. They are specifically designed to provide working capital, allowing SMEs to manage day-to-day expenses, maintain operations, and grow.

In Singapore, corporate loans for SMEs come in various forms, each catering to different needs and circumstances. Below are some popular types of corporate loans available for SMEs:

1. Working Capital Loans

Working capital loans are short-term loans designed to cover immediate cash flow needs. These loans can be used for inventory purchase, payroll, operational costs, and other routine expenses. They typically have a faster approval process and are ideal for businesses facing temporary cash shortages.

Advantages:

• Quick access to funds.
• Flexible repayment terms.
• No collateral required (depending on the lender)

2. Invoice Financing

Invoice financing, also known as invoice factoring, is a form of financing where you provide your outstanding invoices to a lender at a discount in exchange for immediate cash. This option allows you to access funds tied up in accounts receivable, which is especially beneficial if you’re dealing with late-paying clients.

How It Helps with Cash Flow:

• Access cash immediately rather than waiting for client payments.
• Improve liquidity without taking on traditional debt.
• Get around 80-90% of the invoice value upfront, with the remainder after the client pays.

3. Purchase Order Financing

Purchase order financing is a specialised form of business funding that helps businesses with cash flow gaps between receiving a purchase order and delivering the product to the customer. This type of loan allows SME businesses to finance the production or acquisition of goods before the customer pays.

How It Helps with Cash Flow:

• Allows you to fulfill large orders or restock inventory without waiting for customer payment.
• Helps cover supplier costs and ensures timely delivery of products.
• Provides the working capital needed to scale quickly and fulfill demand.
  

Advantages:

• Suitable for businesses with strong customer demand but limited cash flow.
• Helps businesses take on large orders that they might not otherwise be able to fulfill.
• Reduces the need for upfront capital investment in inventory.

Want to learn more about SME financing options for your business?

At GXS Capital, we are proud to offer a wide range of tailored financial solutions, including working capital loans, invoice financing, and purchase order financing, designed to help Singapore SMEs manage cash flow, meet business demands, and accelerate growth. Trusted by thousands of Singaporean businesses, we are now a wholly-owned subsidiary of GXS Bank, bringing you a seamless blend of financial expertise and innovative solutions. With our deep understanding of the local market and commitment to empowering SMEs, GXS Capital is here to provide the financial flexibility and support your business needs to thrive in today’s competitive landscape. To learn more, visit www.gxscapital.sg