Singapore is known as a business-friendly country, and with the government’s efforts to support local enterprises, it is an ideal place for entrepreneurs to start and grow their businesses. One significant challenge that businesses face is accessing financing to support their growth plans. In response, Enterprise Singapore introduced the Enterprise Financing Scheme (EFS) in 2019 to streamline existing financing schemes and make it easier for enterprises to access financing.
Enterprise Financing Scheme (EFS)
The EFS covers seven areas, including green projects, daily operational cash flow needs, investment in fixed assets, growth of innovative enterprises, trade needs, fulfillment of secured overseas projects, and acquisition of target enterprises with the intent of internationalization. The government will share the loan default risk with the participating financial institutions (PFIs) in the event of enterprise insolvency.
To be eligible for the EFS, the SME must be a registered business entity physically present in Singapore, have at least 30% local equity held directly or indirectly by Singaporean(s) and/or Singapore PR(s), and have group annual sales turnover not exceeding S$500 million. For “SME Working Capital” and “SME Fixed Assets,” the SME definition refers to group revenue of up to S$100 million or a maximum employment size of 200 employees.
While the EFS provides many options for financing, navigating the process can be challenging for some SMEs. This is where loan brokerages such as SME Global Funding can help. As a professional loan brokerage, SME Global Funding can provide guidance and advice on which financing options are best suited for a particular SME’s needs.
Alternatives Schemes and Grants
In addition to the Enterprise Financing Scheme, there are other grants and schemes that businesses in Singapore can tap into to support their growth plans. Here are some of them:
- Productivity Solutions Grant (PSG)
The PSG is designed to help businesses adopt productivity solutions and equipment to enhance their capabilities and streamline their operations. This grant covers various solutions and equipment, including IT solutions, automation equipment, and security systems. SMEs can receive up to 80% funding support for their project costs under the PSG.
- Market Readiness Assistance (MRA) Grant
For SMEs looking to expand their business overseas, the MRA grant provides funding support for overseas market set-up, identification of business partners, and overseas market promotion. SMEs can receive up to 70% funding support for eligible expenses under the MRA grant.
- Capability Development Grant (CDG)
The CDG provides funding support for businesses looking to upgrade their capabilities through consultancy projects, training, and certification. This grant covers various areas such as financial management, human resource management, and business strategy development. SMEs can receive up to 70% funding support for their project costs under the CDG.
- Startup SG Equity
For startups in their early stages of development, the Startup SG Equity scheme provides co-investment funding with private sector investors. This scheme aims to encourage private sector investment into startups and promote innovation and growth in the startup ecosystem.
- Enhanced Enterprise Singapore (ESG) Loan Insurance Scheme
The Enhanced ESG Loan Insurance Scheme provides loan insurance to SMEs that may have difficulty obtaining financing due to their lack of collateral or track record. The government co-shares the default risk of the loans with the participating financial institutions, which encourages these institutions to lend to SMEs.
Getting help from a loan broker
Navigating the various financing schemes and grants available can be overwhelming, especially for business owners who are not familiar with the application process or criteria. This is where loan brokers can be invaluable.
Loan brokers have extensive knowledge of the financing landscape and can provide guidance on the most suitable financing options for your business. They can also help with the application process and ensure that your application meets the criteria of the financing schemes or grants.
Using a loan broker like SME Global Funding can save business owners time and effort, as they do not have to navigate the financing landscape on their own. In addition, loan brokers can also negotiate with the participating financial institutions on behalf of the business owner to secure the best terms for their financing.
Invitation for a free consultation with a loan specialist
If you are a business owner in Singapore looking for financing options to support your growth plans, SME Global Funding can provide a free consultation with a loan specialist. Our loan specialists have extensive knowledge of the financing landscape and can guide you through the application process for the various financing schemes and grants available.
In addition, we can help you secure the most suitable financing option for your business and negotiate with the participating financial institutions to secure the best terms for your financing. Contact us today for a free consultation and take the first step towards realising your growth ambitions.