• 4 May 2021
  • Business Loan|EFS|enterprise financing scheme|esg|small business loans made easy|SME Working Capital

Validus: Government-assisted SME loan application checklist

4 things to prepare when applying for an Enterprise Financing Scheme loan

Nothing slows down any application process like an incomplete application. We understand how frustrating it can get. 

Here is the list of four things you would need to get ready when applying for a Govt-assisted SME loan with Validus for a smoother, fuss-free experience. 

1. Bank statements (past six months) 

This is a mandatory requirement for a business loan credit assessment, regardless of the type of lender you would turn to for a business loan. These bank statements help lenders like us understand your business account from the beginning and ending balance for a specific period, deposits, withdrawals, bank fees, and other charges paid in chronological order. 

These bank statements essentially provide an insight into how well you are managing your business’s cash flow and play an integral role on the lender’s part in determining your business loan’s application success rate. 

2. Financial Statements / Management Account (past one year) 

These financial statements will consist of: profit and loss statement, balance sheet, cash flow projections, and last six months of bank statements / current account statements of the main opening account. 

What if you don’t have audited financial statements for the past year? You can prepare an updated management account instead. 

Do consider the various savings incurred from multiple schemes, rebates, or grants received and reflect these in the cash flow projections. It is always good to stress test the cash flow projections for different revenue scenarios. 

You can check out IMDA’s digital solutions for platforms that can help generate financial statements and transaction histories. 

3. Credit Bureau Statement (past one month) of Personal Guarantor(s) 

To assess your creditworthiness, Credit Bureau Statement is a crucial piece to understanding your company’s directors’ repayment histories, existing loans, and outstanding unsecured loan amounts that you have. 

It sounds like a lot of work but providing this information can help Validus determine whether your business can smoothly operate without running into any cash crunch in the immediate future. 

4. Notice of Assessment (past one year) of Personal Guarantor(s)

To determine a borrower’s eligibility for a business loan amount and tenor, Validus refers to the Personal Guarantor(s) income in their personal NOA as one of the factors for consideration. 

Note that the NOA here refers to the personal NOA of the Personal Guarantor(s) and not the company’s NOA. 

Together with the NOA and CBS Report, Validus will be able to gauge the total debt-to-income ratio. Should the amount of unsecured debt exceed the Personal Guarantor(s)’s income, lenders will be less likely to approve the loan because they would be perceived as less capable of repaying the loan. 

 

We hope this information has provided you with insight when applying for an EFS loan with Validus! Feel free to reach out to us if you have any questions along the way. 

Note that required application documents may vary on application based on the financing request, and information requirements would defer from one financial institution to another. 

When in doubt, chat with us, and we will get back to you within one working day. 

 

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