Singapore Enhances Financing Schemes With Extra Loans For Local Firms
Written by Writer on Saturday, November 22nd, 2008
Singapore Enhances Financing Schemes With Extra Loans For Local Firms
SINGAPORE, Nov 21 (Bernama) — The Singapore government today announced that it will enhance business financing schemes to support an additional S$2.3 billion in loans to help local firms gain access to credit during the current economic slowdown.
The Ministry of Trade and Industry (MTI) said the enhancements included increasing loan quantum, raising government risk sharing of loan defaults and extending business financing schemes to all local enterprises.
About 124,000 local companies would be eligible for these enhancement schemes that would take effect from Dec 1, MTI said in a statement.
The ministry said the government was acting early to enhance the local business financing schemes in anticipation of greater credit tightening as a result of the global financial crisis.
These measures sought to ensure that local enterprises had sufficient resources to continue to operate, invest, trade and internationalise in an adverse economic climate, it said.
One of the schemes, Bridging Loan Programme, allows local enterprises with more than 10 employees access credit of up to S$500,000 to help them meet their working capital needs during the current tightening of credit conditions.
Small businesses with no more than 10 employees have access to the Standards, Productivity and Innovation Board (SPRING)’s Micro Loan Programme, which will be further enhanced to provide unsecured working loans of up to S$100,000, up from the previous limit of S$50,000.
The government will increase its sharing of the loan defaults from the current 50 percent to 80 percent to alleviate the risk taken by participating financial institutions to ensure that small and medium enterprises (SMEs) could continue to access loans through the existing Local Enterprise Financing Scheme to purchase equipment, machinery and other assets.
The government will also raise the investment cap from the current S$300,000 to S$1 million under the SPRING’s Start-up Enterprise Development Scheme and from the current S$1 million to S$1.5 million for Business Angels Scheme to encourage and help new start-ups.
It would also raise all the financing caps under the Internationalisation Finance Scheme for different types of trading companies, currently varying between S$100 million and S$200 million to S$300 million to assist them in expanding overseas, MTI said.
– BERNAMA
