SME Loan Singapore- Working Capital Loan

The TBLP was introduced to help the enterprises access working capital.

As announced in the Solidarity Budget on 6 Apr 2020, the Government will enhance the TBLP further with 90% risk share. The enhancement will apply to new applications initiated from 8 April 2020 until 31 March 2021. For applications that are pending approval from PFIs, enterprises are advised to speak to their PFIs on their eligibility.

As announced on 12 Oct 2020, TBLP will be extended from 1 Apr 2021 to 30 Sep 2021. Under this extension, the Government’s risk-share on the loan will be lowered to 70% (90% currently) with the maximum loan quantum lowered to S$1 million (S$3 million currently). This is to calibrate the support for businesses as the economy gradually recovers.

Yes, SMEs can approach different financial institutions to apply for Temporary Bridging Loan. However, the total aggregate borrowing under the scheme from different Financial Institutions cannot exceed S$1,000,000.

The participating Financial Institutions for the Temporary Bridging Loan Scheme are:

• 
  

  CIMB Bank Berhad

  
  


• 
  

  DBS Bank Ltd

  
  


• 
  

  ETHOZ Capital Ltd

  
  


• 
  

  FS Capital Pte Ltd

  
  


• 
  

  Goldbell Financial Services Pte Ltd

  
  


• 
  

  Hong Kong and Shanghai Banking Corporation

  
  


• 
  

  Hong Leong Finance Ltd

  
  


• 
  

  IFS Capital Ltd

  
  


• 
  

  Innoven Capital

  
  


• 
  

  Maybank Singapore Ltd and Malayan Banking Berhad, Singapore Branch

  
  


• 
  

  ORIX Leasing Singapore Ltd

  
  


• 
  

  Oversea-Chinese Banking Corporation Ltd (OCBC Bank)

  
  


• 
  

  Resona Merchant Bank Asia Ltd

  
  


• 
  

  RHB Bank Berhad

  
  


• 
  

  Sing Investments & Finance Ltd

  
  


• 
  

  Singapura Finance Ltd

  
  


• 
  

  Standard Chartered Bank

  
  


• 
  

  United Overseas Bank Ltd

  
  


• 
  

  Validus Capital Pte. Ltd.

  
  

Temporary Bridging Loan was introduced in response to the COVID-19 outbreak, to help SMEs manage their immediate cash flow needs.

Eligible SMEs can borrow up to S$1 million, with an interest rate capped at 5.5% per annum. SMEs that require help beyond the Temporary Bridging Loan can also tap on the Enhanced Working Capital Loan, which has been further enhanced to support loans of up to S$500,000.

Different banks have different risk appetites at different times, hence their lending policies can differ. A credit score in risk grade HH might be upright rejected by some financial institutions while others like Maybank might approve the application (Subject to Company Financial Profile and mitigation of bad Credit Bureau Score.) 

Financial Institutions like Ethoz and Orix might not even need to run Directors' CBS search if entities have more than 2 Directors/ Shareholders. 

The best thing you can do is to improve your credit score as much as you can and keep it at that highest possible level or approach us for advisory.

Find out more about how your personal credit bureau affects your business loan application here.

No. With the Co-Risk sharing scheme PFIs will be more inclined to take in more loan exposure to a certain extent, but that does not necessarily mean a lenient risk assessment.  PFIs will still approve applicants within their own credit parameters and comfort levels; although credit parameters can differ among PFIs, their main assessments are still based on company Financial Reports, Bank Statements and Individual Directors’ declared income assessments.

Most PFIs will require the standard documents listed below for processing:

• 
  

  Latest 6 months company’s operating account

  
  


• 
  

  Latest 2 years company audited/ management report

  
  


• 
  

  Latest 2 years notice of assessment of directors/shareholders

  
  


• 
  

  Photocopy of directors/shareholders NRIC (front and back)

  
  

Some may ask for additional documents such as the company’s debtor aging list, corporate Notice Of Assessment, GST tax filing, etc.

We wish too! But sadly, borrower and guarantors are responsible to repay 100% of the loan amount.

In the event of default, Participating Financial Institutions are obligated to follow their standard commercial recovery procedure, including the effect of the personal guarantee (which means PFIs will foreclose, auction off any valuable assets of the company and guarantors), before they make a claim against Enterprise Singapore for the unrecovered amount in proportion to risk-share. 

All eligible enterprises applying for the Temporary Bridging Loan are subject to assessment by Participating Financial Institutions (PFIs).

As different PFIs have different lending criteria and assessments, one rejection might not mean rejection in others but do note that any failed application with a PFI will result in a waiting period of 6-12 months before the business can re-apply with the same PFI.

To avoid this, one can approach a platform like us to assist with the company's financial assessment before they submit to PFIs. 

Businesses that require further support may approach Enterprise Singapore at (65) 6898 1800 or enquiry@enterprisesg.gov.sg for assistance

Applications may possibly be rejected due to the following reasons:

1. 
   

   Poor credit bureau standing of the guarantor of the application

   
   


2. 
   

   Loss making company

   
   


3. 
   

   Negative net-worth company

   
   


4. 
   

   Poor repayment conduct of existing personal or business loan facility with the applicant lender

   
   


5. 
   

   Poor mid/end month balance sighted

   
   

All business term loans will require the company’s director and shareholder to be the personal guarantor. As per MAS notice 645 TDSR (Total Debt Servicing Ratio) guideline, 20% of the monthly repayment instalment for any relevant credit facility which the borrower is a guarantor of will be factored into the TDSR calculation.

Site visit inspection is part of the Participating Financial Institution's due diligence to make sure applicants are running a proper and legit business.

The site visit includes but not limited to:

1. Proper Company signage and tenancy agreement sighted for Company registered address

2. Sighting of Original Company operating account statements

3. Selfie with Company key person 

4. Taking pictures of company premises, inventory, staff, etc. 

Yes, of course. Besides applying by yourself, you can engage us to act as a middleman between you and potential lenders. We understand the daunting task of going through the whole rigorous process of document submission and numerous Q&As for a company to take up a business term loan.

Our job is to work on your behalf and with several PFIs to find the best business term loan lenders who best fit your needs with the lowest rates. We have a well-developed stable of lenders we work with, making your life easier. We are like your company loan concierge; we do all the legwork for you, negotiate terms, and make the approval magic happen. All for a nominal fee, of course.

Else contact us through our whatapps or email and our friendly consultants will guide you.

We get this enquiry a lot where business running as a sole-proprietor business with no business account.

Participating Financial Institutions required corporate bank statements for their credit assessments, thus our advice is to set up a business banking account and credit all future business proceeds to the newly set-up corporate account and apply for a business loan in 6 months time (Most PFIs required 6 months bank statement for submission except for DBS which required only 3 months bank statement for credit analysis)

Credit Call is part of the Participating Financial Institution's due diligence to make sure applicants are running a proper and legit business. Credit call is required when PFIs used solely bank statement analysis for their credit assessments. (PFIs like UOB and CIMB)

Usually, the credit call to Keyman of the business comprise of the following questions:

1. Nature of Business
2. Financing Purpose
3. How does Covid-19 affect the business
4. Proposed Loan Amount
5. Is the company profit-making?
6. What is the existing company loan commitment?
7. Annual Sales Turnover

In general, simple interest rate is less than the effective one, which is why lenders might be less inclined to advertise the latter instead of the former even though the effective interest rate is clearly the more useful rate for consumers to know.

But under the Code of Advertising for Banks that mandates that any interest-bearing loan must include the effective interest rate, in the final Offer Letter, the effective interest rates will still be reflected.

Then what is the difference between Simple Interest and Effective Interest? Are they the same?

Read here to find out more: https://www.smart-towkay.com/blog/view/263-effective-interest-rates-vs-simple-interest-rates-what-to-take-note-of-when-considering-a-loan