Unlocking Sustainability: A Guide to Enterprise Financing Scheme - SME Fixed Assets Loan

Enterprise Financing Scheme – SME Fixed Assets Loan

The Enterprise Financing Scheme (EFS) offers financing solutions for Singapore enterprises to support their investments in domestic and overseas fixed assets.

About the Scheme

The EFS - SME Fixed Assets Loan (EFS-FA) helps SMEs finance investments in both domestic and overseas fixed assets, including:

• Purchasing equipment and machines for automation and upgrading, including new or resale assets.

• Purchasing or constructing government and commercial-built factories and business premises, including new or resale assets.

Loan Details

Maximum Loan Quantum: S$30 million per borrower

Overall Borrower Group Limit: S$30 million for EFS-FA

Overall Loan Exposure Limit: S$50 million per borrower group across all facilities

Maximum Repayment Period: 15 years

Risk Share:

• 50% by EnterpriseSG

• 70% for young enterprises or those operating in challenged markets

• Borrowers are responsible for 100% repayment

• In the event of default, financial institutions must follow standard recovery procedures before claiming against EnterpriseSG for the unrecovered amount in proportion to the risk share.

Interest Rate

Determined by participating financial institutions based on their risk assessment.

Eligibility Criteria

1. Must be a business entity registered and operating in Singapore (including sole proprietorships, partnerships, LLPs, and companies).

2. At least 30% of equity must be held by Singaporeans or Singapore PRs.

3. Group annual sales turnover must not exceed S$500 million.

4. For the SME Fixed Assets definition, SMEs should have group revenue of up to S$100 million or a maximum of 200 employees.

Application Process

Interested enterprises can apply through participating financial institutions (PFIs) or the Enterprise Singapore Incentive Management System (ESIMS), subject to credit approval.

Frequently Asked Questions

1. Application Opening: The scheme launched on October 29, 2019. Applications can be made to PFIs.

2. Multiple Applications: Yes, enterprises can apply through different PFIs.

3. Impact on Existing Loans: Approved loans under former SPRING Singapore and IE Singapore will remain valid and unchanged.

4. Scheme Differences: The EFS has unified eligibility criteria and application processes, enhancing support for young enterprises and those in lower-rated markets.

5. Industry Focus: The scheme is inclusive and supports businesses across all sectors.

6. Support for New Businesses: Yes, it offers government risk sharing to help young companies secure financing.

7. Borrower Responsibilities: Borrowers must repay the full loan amount, with PFIs following standard procedures for defaults before claiming from EnterpriseSG.