Looking for SME grants in Singapore?Save up to 80% off select Shopify planswith the Productivity Solutions Grant. Working in the Singapore Retail industry?Apply for the Digital Resilience Bonustoday and receive up to $2500.
Small-and-medium enterprises (SMEs) are the lifeblood of Singapore’s economy. According to theSingapore Department of Statistics, SMEs form 99% of all enterprises in the lion city, contributing nearly SGD$213 billion to the economy.
While Singapore's economy has been steadily growing, factors such as weakening global demand and inflationary pressure pose a threat to businesses. The silver lining is that the Singaporean government is supporting SMEs with various grants and schemes to help them overcome these issues.
In this article, we’ve highlighted some of the most relevant grant opportunities in Singapore that your small business can take advantage of.
Productivity Solutions Grant (PSG)
The Productivity Solutions Grant (PSG) falls under the IMDA’s Go-Digital campaign. It aims to support Singaporean SMEs in the procurement of IT solutions and other applications to enhance productivity and accelerate digital transformation. Eligible SMEs must be at least 30% owned by Singaporean citizens/PRs.
Renewed for 2023, Shopify is one of the approved partners of IMDA Singapore and eligible businesses can use the PSG grant to claim a discount of up to 50% on their annual Shopify plan or up to $5,000 on the Shopify Plus plan
Here’s more information onPSG for ShopifyandPSG for Shopify Plus.
Enterprise Development Grant
The Enterprise Development Grant (EDG grant) is squarely aimed at supporting Singaporean businesses to improve on their core capabilities, innovation and productivity, and market access.
An important factor to consider here is that the EDG grant only covers pre-revenue companies. This means those founders that are actively considering an idea but haven’t signed any customers yet can apply. This excludes companies that have entered into a contract but haven’t received the monies yet; a commitment for payment signifies formal start of business.
The EDG grant covers project costs such as third-party consultancy fees, software and equipment, and internal manpower cost. It can also be used to hire management consultants in order to finetune the project and comb out its plan. The maximum support level is 80% of costs, but there is provision in the grant to raise this to 90% if the founders can show that they need the extra funding.
Here’smore information on the Enterprise Development Grantand details on how to apply.
Enterprise Financing Scheme
The Enterprise Financing Scheme (EFS) is earmarked for those companies that are in the growth stage and wish to either expand overseas, create new products, or develop new capabilities. The Singapore government realizes that access to financing is a crucial part of this phase and hence has broken up the scheme in 6 broad categories:
SME Working Capital Loan
The SME working capital loan is a practical financial solution for businesses that need to meet their operational cash flow requirements.
In Singapore, beneficiaries of this loan pay low interest rates, ranging from 3.75% to 4.5% per annum, with charges based on a reducing balance model. Note that the maximum loan amount is S$500,000 and the repayment period can extend up to a maximum of 5 years.
The main advantage of a working capital loan is that it enables companies to respond promptly to market shifts or growth opportunities.
For instance, an increased demand for your product may cause you to expand your production capacity. Alternatively, you may want to make bulk purchases to get wholesale discounts from your suppliers . In either scenario, a working capital loan provides the necessary capital to seize these opportunities without disrupting your cash flow.
SME Fixed Assets Loan
The fixed capital loan is a financing option designed to help SMEs acquire both domestic and overseas fixed assets, such as equipment and machinery. It has a maximum quantum of S$30 million, with a repayment period of up to 15 years.
Under the Enterprise Financing Scheme (EPS), young SMEs can get up to 70% risk-sharing for their investment, and up to 50% is available for standard enterprises. The loan’s mechanisms make it a suitable option for businesses looking to finance high tech or specialized machinery that boosts operational efficiency.
Venture Debt Loan
To accelerate the growth of innovative SMEs that do not possess significant assets to be used as collateral, the Singaporean government created a venture debt loan.
This loan has a maximum quantum of S$8 million and a maximum repayment period of 5 years. Issuers will evaluate applicants based on the amount of equity funding they’ve obtained from venture capitalists, plus the uniqueness of their business model and/or offerings.
High-growth enterprises can use the venture debt loan to diversify into new product lines, grow and expand existing capacity, undergo mergers and acquisitions, and augment working capital needs. It’s especially suitable for companies operating in fast-advancing sectors such as deep tech.
Trade Loan
The EFS Trade Loan program is available to Singapore SMEs for financing trade requirements, such as inventory or stock financing, structured pre-delivery working capital, and factoring or bill of invoice. The maximum loan quantum is S$10 million per borrower, and the repayment period is one year.
Trade loans enable SMEs to secure an unsecured trade line facility without putting up hard assets as collateral. This allows businesses to manage their working capital, purchase inventory, and meet other trade requirements. Factoring, for instance, improves cash flow, while overseas working capital loans help businesses expand internationally or source goods from overseas.
Project Loan
The EFS Project Loan scheme is designed to assist small and medium-sized enterprises (SMEs) in financing secured projects outside of Singapore. This loan covers financing for working capital, guarantee, and fixed assets, and borrowers can receive up to S$50 million for overseas projects and S$30 million for domestic projects. The maximum repayment period for the loan is 15 years.
才有资格EFS项目贷款,企业s must have a contract, secured sales order, or project tied to fixed assets, working capital loan, and guarantee. This means that only businesses with a clear plan for using the funds and have already secured some form of funding can apply.
Mergers & Acquisitions Loan
合并和收购贷款是专门助教ilored to assist Singapore-based companies in acquiring local or overseas enterprises as part of their globalization strategy. The loan has a maximum quantum of S$50 million and a repayment period of up to 5 years. SMEs considering venturing into emerging sectors and complementary businesses can also benefit from M&A loans.
For more information on the Enterprise Financing Scheme,click here.
Job Support Scheme
The Job Support Scheme (JSS) was announced as part of Budget 2020 and aims to help Singaporean employers retain their local staff (Singaporean citizens and PR holders). Under the scheme, the Singapore government will help finance between 25-75% of the first $4600 of gross monthly wages paid to each local employee in a 10-month period.
Employers that make CPF contributions qualify for this scheme payout barring those explicitly mentioned in the employer exclusion checklist.