SG Govt Will Extend Loans for SMEs by 6 Months as Part of Heightened Alert Support Measures

Singapore's Phase 2 and 3 periods of heightened alert have undoubtedly affected many businesses, especially Small- and Medium-sized Enterprises (SMEs). As such, Finance Minister Lawrence Wong has announced additional support measures for these Singapore-registered companies on 5 Jul 2021.

The Singapore government has acknowledged that access to credit can be critical to many SMEs to help them survive the crisis, and will thus be extending financing schemes. The Enhanced Enterprise Financing Scheme — Trade Loan and Temporary Bridging Loan programme will be extended for 6 more months, from 1 Oct 2021 to 31 March 2022.

For more customised advice in getting your company’s finances in order, talk to our experienced accountants in Singapore. We also assist companies with their e-commerce accounting tasks. Otherwise, do read on to find out more about the extended loan deadlines.

How Will These New Measures Affect Small- and Medium- Sized Enterprises?

There will be a six-month extension of the Enhanced Enterprise Financing Scheme - Trade Loan and Temporary Bridging Loan programmes from 1 October 2021 to 31 March 2022.

This sum will amount to S$1.2 billion, drawing from a reallocation of monies that were previously budgeted for. Half the sum will come from underutilised development expenditure as a result of delayed projects due to COVID-19, and the remaining will be borrowed from The Deep Tunnel Sewerage System and the North-South Corridor projects, capitalising their development expenditure from the fourth quarter of 2021. Since the start of 2021, these schemes overseen by Enterprise Singapore have supported more than S$22 billion in loans to over 25,000 enterprises -- with 99% being SMEs.

Enterprise Financing Scheme – Trade Loan (EFS-TL)

This scheme was previously known as the Loan Insurance Scheme Plus and supports businesses in need of financing for trading, especially in the current climate of longer payment cycles and slower business activities.

Enhanced in April 2020, this scheme adjusted its maximum loan quantum from $5 million to $10 million and increased Government risk-share from 80% to 90%. The enhancement will be applicable to new applications made from 8 Apr 2020 to 31 Mar 2021. For applications pending approval from Private Finance Initiative (PFIs), organisations are advised to reach out to their PFIs to check on eligibility.

On 12 Oct 2020, it was announced that the EFS-TL will be extended from 1 Apr 2021 to 30 Sep 2021. Under this extension, the Singapore Government’s risk-share will be lowered from 90% to 70%, with the maximum loan quantum remaining at S$10 million.

On 5 Jul 2021, it was announced that the EFS-TL will be further extended for six months, from 1 Oct 2021 to 31 Mar 2022, under the same framework.

Temporary Bridging Loan Programme (TBLP)

Introduced in Budget 2020, the Temporary Bridging Loan Programme (TBLP) provides businesses with additional working capital. This scheme was previously extended for an additional six months, from 1 April to 30 September 2021.

Enhanced in April 2020, this scheme adjusted the Government risk-share to 90%. The enhancement will be applicable to new applications made from 8 Apr 2020 to 31 Mar 2021. For applications pending approval from Private Finance Initiative (PFIs), organisations are advised to reach out to their PFIs to check on eligibility.

On 12 Oct 2020, it was announced that the TBLP will be extended from 1 Apr 2021 to 30 Sep 2021. Under this extension, the Singapore Government’s risk-share will be lowered from 90% to 70%, with the maximum loan quantum lowered from S$5 million to S$3 million in a bid to calibrate support extended to businesses as the economy progressively recovers.

On 5 Jul 2021, it was announced that the TBLP will be further extended for six months, from 1 Oct 2021 to 31 Mar 2022, under the same framework.

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