The recent spate of negative corporate news in Singapore – bond defaults and manpower retrenchment – has led banks to become more cautious about lending. This could mean further tightening of the credit environment which is unfavourable for businesses, especially small and medium-sized enterprises (SMEs).
SMEs, who are sensitive to market movements and credit flows, may find themselves trapped in a few difficult situations. Some may be turned away by traditional financial and banking institutions, whilst others face higher loan rates, or are confined to tedious loan request processes.
As such, many have begun to seek alternative financing means, including crowdfunding platforms. However, there are 2 major misunderstandings that we need to address.
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