What SMEs and Individuals Should Know About The Extended Support Scheme - Standardised (ESS-S): An Extension To The Debt Moratorium Programme - Till 30 Sept 2021

Article was published on 02 Nov 2020 and updated on 27 June 2021

As cash flow management continues to be a major problem for Small and Medium Enterprises (SMEs) to stay afloat during this Covid-19 pandemic, the Singapore Government has provided measures to relieve some of the cash flow pressure by allowing SMEs to have more time to resume full loan repayment.

Under the Extended Support Scheme - Standardised (ESS-S), SMEs in Tier 1 and 2 Sectors that are currently participating in ESS-S may opt to defer up to 80% of principal payments on their secured loans granted by banks or finance companies, as well as loans granted under Enterprise Singapore’s Enhanced Working Capital Loan and Temporary Bridging Loan Programme from 2nd November 2020 till 30th June 2021 30 September 2021

Tier 1 and 2 sectors include:
1. Aviation,

2. Tourism,

3. Hospitality,

4. Events Company: Conventions and exhibitions,

5. Construction Company: Built environment,

6. F&B establishment includes: licensed food shops and food stalls (including hawker stalls), 

7. Qualifying retail outlet,

8. Arts and entertainment, 

9. Land transport; 

10. And marine offshore

Eligibility Criteria

• Opt-in basis for borrowers who do not have loan repayments that are more than 30 days past due. 
• Borrowers whose loans are already granted a partial principal moratorium,  should not have overdue payments on those loans. 

Read also: 8 Common Questions SMEs Have About The Temporary Bridging Loan Programme (TBLP) 2020

SMEs that are not included in Tier 1 & 2 sectors can opt for debt moratorium till 31st March 2021.

Updated 2nd November 2020:

SMEs that are badly hit by the COVID-19 pandemic and are faced with cashflow challenges now have two schemes that can help them to restructure their debts.

 

From today onwards, eligible businesses can apply to restructure their unsecured business debts through the Sole Proprietors and Partnerships (SPP) Scheme with Credit Counselling Singapore (CCS). SPP will allow for lower monthly instalment payment for unsecured business borrowings by extending the loan repayment period to a maximum of eight years. Interest rates will be based on original contractual terms, capped at 7% per annum.

The following criteria are required for companies to be eligible for the SPP Scheme:

- Businesses must be operating as Sole Proprietorships or Partnerships

- Total unsecured debt does not exceed S$1 million

- Company owes unsecured debts to two or more lenders

Facilitate Restructuring of SME's Loan

The application window for the Extended Support Scheme – Customised (ESS-C) will be extended from 30 June 2021 to 31 December 2021. 

SMEs with more than one lender can also apply for the Extended Support Scheme - Customised (ESS-C) from now till 30 June 2021 31 December 2021. ESS-C helps SMEs to restructure their credit facilities, such as loans under Enterprise Singapore’s Temporary Bridging Loan Programme and Enhanced Working Capital Loan Scheme, across multiple banks and finance companies.

SMEs with more than one lender may approach any of their lenders to assess if they would benefit from a multi-lender restructuring programme.

Eligibility Criteria
All SMEs with multiple creditors that do not qualify for other restructuring programmes, such as  the Simplified Insolvency Programme, and Sole Proprietors & Partnerships Scheme.

The current list of banks and finance companies that will offer the ESS-C are:

- Bank of China

- CIMB Bank

- Citibank

- DBS Bank

- HL Bank

- Hong Leong Finance

- HSBC Bank

- Indian Overseas Bank

- Industrial and Commercial Bank of China

- Malayan Banking Berhad and Maybank Singapore

- OCBC Bank

- RHB Bank

- Sing Investments & Finance

- Singapura Finance

- Standard Chartered Bank

- UOB Bank

 

More information may be found at https://abs.org.sg/sme/relief-measures/ess.

  

FAQ (FOR SMEs):

1. Who can qualify?

This Extended Support Scheme- Standardised (ESS-S) relief scheme will be made available to all SMEs that are not more than 30 days past due on their loan payment and subject to respective lenders assessments.

For those who opt for debt moratorium previously, there should not be any overdue interest payments on the loan.

2. What if I have multiple bank loans, can I apply the Extended Support Scheme - Standardised (ESS-S) relief scheme for all lenders?

For multi lenders SMEs, they can opt for the New Extended Support Scheme- Customised (ESS-C).

More information may be found at https://abs.org.sg/sme/relief-measures/ess.

3. What about my industrial and commercial property loan commitment?

From 9th Nov 2020 till 30th Jun 2021 30 September 2021, SMEs that have commercial/ industrial property loans may apply to their respective bank or finance company to make reduced installment payments pegged at 60% of their monthly installment, for up to nine months.

FAQ (FOR INDIVIDUALS):

1. Am I eligible for Extended Support Scheme- Standardised (ESS-S) for my personal property loan?

From 9th Nov 2020 till 30th Jun 2021 30 September 2021, Individuals that have residential property loans may apply to their respective bank or finance company to make reduced installment payments pegged at 60% of their monthly installment, for up to nine months

To qualify for this scheme, Individuals must show proof of reduction in income of at least 25%, with loan repayments not more than 90 days past due, regardless of if they opted for a moratorium previously. 

 2. Does this scheme apply for renovation and student loans?

Individuals can apply to their respective banks to extend their existing loan by up to three years.

To qualify for this scheme, Individuals must show proof of reduction in income of at least 25%, with loan repayments not more than 90 days past due, regardless of if they opted for a moratorium previously.

This is different from the April 2020 moratorium program where applicants do not need to demonstrate any impact from Covid-19 to secure the deferment. 

3. I am in the Debt Consolidation Plan (DCP), can i request to extend the loan tenure?

Existing Debt Consolidation Plan individuals can request to extend the loan tenure of their DCPs for up to 5 years and they have till 30th June 2021 September 2021 to do so.

To qualify for this scheme, Individuals must show proof of reduction in income of at least 25%, with loan repayments not more than 30 and 90 days past due

4. Can I still apply for restructuring of my unsecured revolving credit facilities under the existing debt relief scheme?

Yes, individuals have up to 30th June 2021 30th September 2021 to convert their outstanding balances to term loan at a reduced rate. The interest rate on the structured term loan is capped at 8%

Source: Business Times

Read also: Government Support: More Grants and Loan Support for SMEs 2020
Read also: With MAS and Banks In Talks To Extend Debt Relief Scheme, Should You Opt In Or Not?

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