Budget 2022: Loan assistance for SMEs, construction sector extended by 6 months to a year
THE government is extending loan assistance programmes for small and medium-sized enterprises (SMEs) for another 6 months, said Finance Minister Lawrence Wong.
The government is also extending loan assistance programmes for construction projects for another year to Mar 31, 2023.
The "significant additional support" aims to help businesses tide over the current period of high prices, Wong said in his Budget speech on Friday (Feb 18).
To support companies with cash flow needs, the Temporary Bridging Loan Programme (TBLP) and the Enhanced Enterprise Financing Scheme - Trade Loan (EFS-TL) will both be extended until Sep 30, 2022.
The maximum loan quantum for the TBLP will be revised to S$1 million per borrower, from S$3 million, while the maximum loan quantum for borrower groups will be set at S$20 million.
The cap on the interest rate is also raised to 5.5 per cent, from 5 per cent previously.
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The maximum repayment period is at 5 years, while the government's risk share is at 70 per cent.
As for the EFS-TL, the maximum loan quantum will be revised to S$5 million per borrower, from S$10 million previously, while the maximum loan quantum for borrower groups will be set at S$20 million.
The interest rate is subject to assessment by participating financial institutions, and the maximum repayment period is at 1 year.
For the government's risk-share on the loans, it will be at 70 per cent until Sep 30, 2022.
Beyond Sep 30, risk-share will be at 50 per cent for standard companies, while 70 per cent will be maintained for young enterprises and companies trading in countries with S&P ratings BB+ and below.
Meanwhile, the Enterprise Financing Scheme - Project Loan, enhanced in January 2021 to support challenges during the pandemic, is extended to support construction enterprises in fulfilling domestic projects amid rising costs and tightened cash flows.
The maximum loan quantum is at S$30 million per borrower or borrower group for domestic projects, and is eligible for Singapore enterprises in the construction sector.
The maximum repayment period is 15 years, and the government's risk-share will be 50 per cent for standard companies and 70 per cent for young enterprises. The interest rate is subject to assessment by participating financial institutions.
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