Regular repayment on a small loan may reflect an established credit history and you as a reliable borrower when compared to one who has limited or no credit history.
Other example includes during Covid-19, many banks prioritize their existing clients first due to a large amount of enquiries received. However, be careful not to take on a loan earlier than you can afford. One late payment on your smaller loan could make your chances of qualifying for future funding even worse than if you had never applied for the small loan at all. Alternatively, consider getting an overdraft which only charges you interest when you draw down on it.