How SME Banking Solutions Can Help Manage Your Business

How SME Banking Solutions Can Help Manage Your Business

Small and medium-sized enterprises (SMEs) play a major role in the economic landscape of Singapore by creating more job opportunities and largely contributing to the country’s gross domestic product (GDP). Most banks help SMEs through the best cash flow and working capital support to SMEs.

A few of them, like DBS Bank, help them meet their financial needs through digital banking tools and solutions. As an SME bank, it offers small businesses hyper-personalized solutions through advanced data analytics and ecosystem partnerships to meet their individual needs. SMEs can ensure that they have the consistent cash flow to manage their daily operating costs, which is key to a business’ growth.

When it comes to small and mid-sized enterprises, they can now manage their money through business banking services provided by most banks. Such services come in the form of corporate banking and help SMEs maintain sufficient cash flows to meet their daily operations. They also help a startup or small business save money on interest, bank charges, payroll taxes, and late-payment penalties. An SME bank can help small and medium-sized businesses in several ways like:

As an SME, you can take advantage of business banking services in the following ways:

  1. Small Business Funding

Your small business requires funding to accelerate its growth through smooth operation every day. Banks like DBS offer one-stop business solutions to help meet your short-term obligations. By choosing a suitable funding model, you can find opportunities to expand your business and grow further. Here are some innovative ways banks fund your business:

  • SME Working Capital Finance

An SME needs a working capital loan to meet its everyday operating expenses, like paying utility expenses, wages and salaries, rent, and creditors. You can get a working capital loan up to SGD 300,000 over a flexible repayment period to expand your business, develop a new product, or improve your cash flow. Various ways to avail of working capital finance for SMEs include:

o   Business Loans: They are short-term funding by banks to help you meet your operating expenses or expand your business. Business loans are offered with a repayment period of a maximum of 5 years based on an SME’s eligibility.

o   Venture Debt Financing: As an alternative to venture equity financing, an SME bank offers venture debt financing to a startup or a company in the early stage to grow its business, minimize equity dilution, extend cash runway, and minimize the financing cost.

o   Block Discounting: SMEs like auto dealers can use this revolving credit facility to get loans against their future income. Auto dealers and credit companies use hire-purchase agreements to finance their customers. They go for business funding through block discounting to have funds for daily operations, for their money is tied up in hire-purchase agreements.

o   Overdraft: SMEs can use an overdraft facility from banks to fund their growth. They can withdraw only what they want, thus saving on interest.

o   Business Recovery Loans: These loans are offered to SMEs strapped for cash. Being a Temporary Bridging Loan, a business recovery loan is offered at a repayment period of 5 years at reasonable interest.

o   Supply Chain Finance: With supply chain finance, an SME supplier gets the payment early, without disturbing the buyer, who can have lengthy payment terms. For instance, the Supply Chain Finance programs by DBS are meant for both supplier and buyer finance.

  1. Quick Payments

When it comes to managing their operations and growing their business, SMEs take on several challenges. Most banks help them meet their particular needs through complete digital payment solutions in their business banking services. With contactless payments, your small enterprise can optimize its operations. Some popular digital payment solutions, which are secured, fast, and efficient, are offered by DBS, and they include:

  • PayNow Corporate

Your business can make and receive instant payments in Singapore dollars (SGD) through PayNow Corporate. For this purpose, you need to register your Unique Entity Number or UEN to pay or receive payments instantly in your bank account. You can also use the PayNow QR code to transfer funds to other bank accounts or pay off your creditors.

  • FAST

Business owners can make interbank fund transfers in SGD via DBS IDEAL at any time. Your customers will get the payment instantly.

  • MEPS

You can pay your local customers through MAS Electronic Payment System in SGD within minutes.

  • GIRO Payroll:

It immediately helps you pay directly to your employees’ bank accounts. With GIRO Payroll, you don’t need any cash or cheque.

  1. Seamless Collections

Banks in Singapore have introduced innovative digital payment tools to help SMEs expand their operations to other markets. They can now manage their collections on one platform using multiple payment options. For instance, DBS offers your business the MAX Portal to:

  • Reconcile with PayLah! PayNow, Debit or Credit Cards, and QR transactions
  • Go cashless without any new terminal
  • Develop your business by enabling customers to pay through multiple payment methods using mobile wallets and QR codes.
  • Make informed decisions using reporting tools to have transaction analysis

Small businesses can use DBS IDEAL for payments through MasterCard, Visa, UPI, and JCB payment methods. Further, it also helps them know the latest account balances by generating the consolidated settlement report.

To conclude, an SME bank can help you with a working capital loan to help grow your business. Other than this, it allows you to have customized payment and collection solutions to attain your financial objectives.

I am a full-time professional blogger from India. I like reading various tech magazines and several other blogs on the internet.

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