Government Funding and Assistance Schemes Available in Singapore: Loans & Insurance, Part II

Government Funding and Assistance Schemes Available in Singapore: Loans & Insurance, Part II

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In Part I of this series, we discussed two Government-assisted loans and insurance available for start-ups in Singapore. In this article, we will look at the remaining two assistances available.

 

Internationalisation Finance Scheme

The following is a list of Internationalisation Finance Scheme loans that have been integrated into the Enterprise Financing Scheme. They apply to mid-sized companies.

 

Type of Loan

Financing Capital Purpose

Maximum Repayment Period

Trade Loan $5 million Finance Import, Export and Guarantee needs, including:
  • Inventory / stock financing
  • Structured pre-delivery working capital (revolving working capital)
  • Factoring (with recourse) / bill of invoice / AR discounting
  • Overseas working capital loan
Up to 1 year
Project Loan $50 million Finance the fulfilment of secured overseas projects including:
  • Working capital and trade loans
  • Equipment/ machineries/ vessels/ other fixed assets
  • Guarantees
Up to 15 years
Mergers & Acquisitions Loan $50 million Finance the acquisition of target enterprises with the intent of internationalisation. Up to 5 years

 

To be eligible for these loans, companies must:

  • Be registered and operating in Singapore;
  • Have a minimum of 30% local shareholding;
  • Maximum Borrower Group revenue cap of S$500 million for all companies.

 

Loan Insurance Scheme

Under the Loan Insurance Scheme, commercial insurers, participating Financial Institutions insure loans in the case of default in an enterprise insolvency. A portion of the insurance premium is supported by the Government.

Enterprises can apply for the LIS to secure short-term trade financing for the purpose of:

  • Inventory/ stock financing facility
  • Structured pre-delivery working capital
  • Factoring/ bill or invoice or accounts receivable discounting with recourse
  • Overseas Working Capital Loan
  • Banker’s Guarantee

 

To be eligible for the LIS, companies must:

  • Be a business entity that is registered and physically present in Singapore;
  • Have a minimum of 30% local shareholding;
  • Group revenue of up to S$100 million or maximum employment of 200 employees.

 

CONCLUSION

We have looked at three different categories of government support schemes given to SMEs and start-ups in Singapore, namely, grants, loans and insurance. In the next part of this series, we explore Government-assistance for upskilling and retraining for Singapore companies.

At Silvester Legal, we work extensively with start-ups to understand our clients’ needs. We want our clients to take full advantage of the opportunities available to them as they pursue their business ventures.

 

Disclaimer: The materials prepared here are for general information purposes only to inform you about Silvester Legal LLC, our services and related matters. The information presented is not legal advice and is not to be acted on as such.

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