Bugis Credit Pte Ltd is a licensed moneylender (License No. 27/2023) listed in the Registry of Moneylenders, under the Ministry of Law in Singapore.

What is a Short Term Loan and Where to Get One

What is a short term loan

Short term loans come in many forms like personal loan, credit line or line of credit, invoice financing, and bridge loans. These are often characterized as high cost loans. However, its importance to people who might have an urgent need for money. In this article, we will discuss the best short term loans and the best institutions to get these from.

What is a Short Term Loan

A short term loan is a type of credit that’s usually obtained to finance either a new business venture or personal financial need. It is a type of loan that involves borrowing a capital amount with the expectation of paying such amount plus the accrued interest rates.

The terms and conditions of the loan like repayment plan, loan amounts, interest rate, and repayment period depend primarily on the stipulation or agreement between borrowers and the financing institution like banks or financing individuals like licensed moneylenders. The repayment period of a short term loan in Singapore usually takes within 12 months from the loan approval.

A short term loan helps those wanting to start an attractive small business venture but does not have the money to do so and does not possess the qualifications or standards required by banks for securing a credit line. Short term loans are ideal both for financing small start-ups as well as personal financial needs because the borrowed amount could be as low as S$100 to as high as S$100,000.

Pros and Cons of Short Term Loans


  1. 0 interest promotional rate. This means that since the loan is short term, the total of interest rate that you need to pay is low compared to that of a long-term loan where you are to pay the interest for at least one year. This is as long as you pay the minimum amount of the remaining balance for each month within the tenure of the loan.
  2. Short term loans also have higher chances of getting approved. A short term loan is especially helpful and can potentially be a lifesaver for businesses and individuals with a low credit score.
  3. The need for a quick cash is resolved through the 95% allowable transfer of the available credit limit in your credit cards. Short term loans allow for some flexibility in your resources.


  1. You can only loan for relatively small amounts. This is because your are expected to be able to pay for this in a short time.
  2. You will have to pay a processing fee. This is usually of small amount only but an additional cost is an additional cost.
  3. The low total interest rate is only true within the term of the loan. While the term expires then the interest rate shoots up and becomes burden some.

In order to make the most out of a short term loan, you need to consider several factors. These include, what will you use the loan for so that you can determine which type of short term loan you will get.

It is also important to make sure that you can pay the loaned amount within the period specified. Lastly, in order to make sure that you will get all of its advantages, line up for licensed moneylenders.

Types of Short Term Loans

Short term loans come in many forms:

1. Merchant cash advances

Merchant cash advances, from its name alone, is not technically a loan but it is more of a cash advance based upon the credit card sales of a business. When a small business applies for this type of short term loan, the said business can have the advance deposited into its bank account instantly.

On the other hand, when instead of a business, an individual applies for a merchant cash advance, the money lender credits the loan amount borrowed. Loan repayment, both by the individual borrower or by the small business, is done by allowing the licensed moneylender to access their credit facility.

An agreed upon percentage of the daily credit card receipts are withheld to pay back the loan provider. Such is called the holdback. Holdback will continue until the money advance is paid in full.

2. Lines of credit

A line of credit can be said to be similar to using a business credit card. There is an agreed credit limit. The borrower can just tap into the line of credit as needed.

It is often characterised as an overdraft facility and usually gives a lower interest rate compared to when you use your credit cards.

Payment period is also flexible and is available when the need arises. A credit line is like a more flexible personal loan.

3. Payday loan

The biggest advantage of a payday loan is the ease of obtaining it. If you find yourself in a desperate need for a quick cash, you can opt for this kind of loan. However, this kind of loan usually has very high interest rates.

The payment term is also usually lump sum. You need to pay the total loan amount and the interest in one go. Payday lenders do this by taking the amount from your bank account on your pay day through continuous payment authority. This scheme can be done in Singapore.

Because of its large interest and this aggressive mode of payment, it is important to make sure that you will have some money to fend for yourself after paying for the lump sum on your pay day.

Otherwise, this may drive you into more short term loans or credit card debt, which you may not be able to pay back on time and thereby affect your credit score.

4. Online or installment loans

This kind of loan is the best when it comes to efficiency because everything is done online. From the application to the approval, all transactions are done remotely. You can get this anytime and anywhere.

The efficiency is further reflected on the speed of the processes. Within minutes after the approval the money gets wired into your account. In Singapore, where transactions increasingly transition online, then this loan is most useful. This kind of loan is also paid in flexible terms, usually on a monthly basis. This is one of the best ways to get quick cash without so much hassle.

5. Invoice financing

This kind of short term loan is a type of business loan and is done using business account receivables. From the name itself, businesses can use the invoices that customers owed them to get a business loan from a financial institution.

The most common time of this loan is what they call the invoice factoring. Invoice factoring is done by invoicing your customers and selling this invoice to a financial institution you wish to get a loan from.

After this, they will give you the money that amounts to as much as 80% of the invoice. The customer will pay the lender on the due date of the invoice and the lender will deduct the money you owed them and their charge, and send you the remaining balance.

Get your FREE Loan Quotes in just 1 HOUR!

Fill out this simple form and we’ll send your custom loan plan with flexible terms

There are also instantly approved loans:

1. Personal loans

Personal loans are intended to help people pay for expenses like education, medical bills or other household purchases and expenses like utility bills, house repairs, etc.

This is different from say, home loans or auto loans because these loans are intended for specific purchases. A personal loan is provided by different lending institutions like banks and licensed money lenders.

Unlike credit card payments, personal loan is paid on fixed-amount installments over a period of time. This kind of loans also have high approval ratings than bank loans but they also have higher interest rates. This is why it is ideal to get personal loans on short term basis only.

Personal loans have lower interest rates than credit cards. However, payment terms of personal loan are not as flexible than those offered by the credit cards like Citibank and HSBC.

2. Foreigner loans

Foreigner loans in Singapore are the kind of loan offered to foreigners studying, working, and residing in Singapore. Foreigner loans can take the form of a personal loan, credit cards, car loans, renovation loans, and other loans in Singapore.

The difference between the loans offered to a Singaporean citizen and a foreign national is not significant, except for the fact that foreigners are usually asked for a higher income requirement than what lenders ask for a Singaporean.

Credit rating is important. There is also a need for them to show that they are legally residing in Singapore. Before giving foreigners some loan services, lenders also look at your intent to stay in Singapore for a considerable period of time.

These details are crucial in their determination of the results of your loan applications. Some lenders may also ask for a guarantor who will attest to various information about you like the amount of money that you are making every month, the consistency of our cash flow, credit ratings and overall personal finance.

Guarantors also serve as a safety net for the lenders. Should there be any trouble on monthly repayments of your loans because of your foreign citizenship, they will go to your Singaporean guarantor.

Depending on the nature of your stay in Singapore, lenders may just give you personal loans with shorter tenure. This is to make sure that you will be able to pay your debt before it is time for you to leave Singapore.

3. Bridging loans

Bridging loans are also referred to as gap financing. Basically, this kind of financing is given to people or businesses as a source of funds while waiting for their constant source of income or cash flow.

Because of this very definition, this is always on the short term basis. Borrowers usually use bridging loans if they anticipate that they can pay the debt immediately because the interest rate is high.

A bridging loan can take the form of home loans usually given to homeowners while they are currently selling their house. Bridging loans can be offered by a bank or by other lending institutions. It can be paid every month quarterly and has a moderate amount of processing fee.

4. Business loans

It is not unusual for business owners and entrepreneurs to avail of business loans in Singapore for different purposes. It can be used for the purchase of equipment or purchase of commercial space, to close a capital gap, or to expand the coverage of the enterprise.

Money is always needed and when funds are unavailable business loans come in handy. Singapore is a very encouraging place for start-ups that is why business loans are widely available and in diverse forms as well. Some of the types of business loans have already been discussed above like the invoice financing and merchant cash advances

Where to apply the best short term loan

Where to Apply for Short Term Loans in Singapore


Banks are often ideal to get all kinds of loans from. From personal loans, credit card, among others. This is because bank loans have generally low interest rates. This is why since a short term loan is notorious for relatively high interest, those offered by banks are preferable.

The downside is, you often need to provide more requirements to prove the health of your personal finance. They are usually stricter. They would look at the status of your account, credit card debt, and outstanding personal loans.

Although, some banks may be more lenient and more helpful when it comes to giving financial advice. Citibank for example provides sound recommendations depending on your need and income.


Licensed moneylenders are a good alternative to banks because they give loans more easily without circumventing the laws. You are sure that you will run into more trouble with the Ministry of Law. Their interest rate is higher but they are still reasonable. They are also providing sound advice on the best short term loans that you need based on your income.

Financial institutions

This is actually a broad category from which you can get short term loans from. They include banks, savings and loans associations, credit unions, travel insurance and other insurance companies and so on. They give different kinds of loans and at varying interest rates. They also have different requirements and levels of approval ratings. Some financial institutions only give members a loan. Apply to become members of credit unions and you may be given access to their credit services.


Pawnshop is another option for getting a short term loan and quick money. However, they can be rigid in terms of payment and they do not usually give high value for items that you may deem valuable. It may not be a good idea especially if we are talking about things that we may not need but are sentimentally valuable to us.

Comparison Table

Type of Lender Loan Amount Interest Rate Payment tenure Processing Speed
Bank As much as 10 times of your salary From 4% p.a.(flat interest rate) Up to 5 years Days to weeks
Moneylenders Up to 6 times of your salary Up to 4% monthly Up to 12 months Within an hour
Financial institutions Based on your needs and the capacity of the institution From 6% p.a. Up to 5 years Within 48 hours
Pawnshops Depends on the item being pawned From 1.5% monthly (The rate increases monthly) Up to 6 months 5-10 minutes

How to Choose the Best Loan Provider

There are a number of institutions and financial companies to choose from when applying loans.

In Singapore, the number one and the most reliable money lending institution is the Bugis Credit Pte Ltd. Bugis Credit provides a wide array of services with competitive interest rates.

The types of short term loans discussed above are offered by this company like the personal loan, foreigner loan, and payday loan. They have high and quick approval as well.

Eligibility and Requirements

These are the basic things and information that you may need to provide in availing short term loans:

  • filled out loan application form and loan agreement
  • bank statement
  • proof of income
  • valid IDs
  • proof of residency (for foreigners)

A lot of short term loans are done online so they ask for really few requirements. To be eligible, institutions usually need to make sure that you have a steady source of income and that you are of legal age of 21 years. Other institutions may ask for more supporting documents but these requirements are basic. Make sure that you check their privacy policy before giving them your information.

Steps to Apply

Procedures vary from one company to another and for different products. But below is the common procedure.

  1. Visit the physical office or the website of your company of choice.
  2. Fill out the application form and sign the agreement
  3. Some may invite you for an interview
  4. Submit all of the requirements
  5. Wait for the approval and for the funds.

Processes may vary but best case scenario is you get an approval in a few minutes. Efficient lending companies like Bugis can provide an approval for as short as 30 minutes.


Short term loans are useful and helpful resources for emergency needs. Its flexibility is also a good selling point.

If you find yourself in a desperate situation, consider getting a short term loan that will take you out of financial trouble and when you need help the most.

A lot of institutions can help. Just make sure that you will be able to pay the loans despite the relatively high cost in time. You may call us for further information!

Ready To Get Your Loan?

Request for a quotation from our friendly officers by filling out the form below

Call Now
× WhatsApp Us