Sun. Sep 20th, 2020

Eligibility and Application for Reliefs and Subsidies in Southeast Asia13 min read

Our team has compiled detailed eligibility and application information for subsidies, financing, and reliefs across Singapore, Indonesia, Malaysia, and Thailand.

Our team has compiled detailed eligibility and application information for subsidies, financing, and reliefs across Singapore, Indonesia, Malaysia, and Thailand. If you have comments regarding your experience applying for/receiving these or more resources other founders in Southeast Asia will be able to benefit from, you can comment below.

Singapore

  1. OCBC Temporary Bridging Loan
    1. OCBC expects the amount of government-assisted loans it lends out to small businesses to hit S$1 billion by June 30, fully utilising the support given by the Monetary Authority of Singapore (MAS) under its low-cost Singapore-dollar facility. Cost savings from MAS’ facility will be completely passed on to customers, by bringing the interest rate of the government-assisted temporary bridging loan to 2-3 per cent. Loan approval period of two days and disbursement of funds within a week. OCBC has digitalised the process and simplified the loan requirements for existing customers. Where hardcopies of documents were required before, electronic copies with digital signatures are now accepted during this circuit breaker period.
    2. Eligibility
      1. Be a business entity that is registered and physically present in Singapore
      2. At least 30% local equity held directly or indirectly by Singaporean(s) and/or Singapore PR(s), determined by the ultimate individual ownership, and
      3. OCBC bank requires guarantor(s) to support the loan.
    3. To apply: WhatsApp OCBC or call them at 1800-BIZLOAN (1800-2495626).
    4. See other government-assisted loans offered by OCBC.
    5. Source: https://www.businesstimes.com.sg/companies-markets/ocbc-to-disburse-s1b-in-government-assisted-sme-loans-to-small-businesses-by-june
  2. Loan Insurance Scheme
    1. Loans are insured by commercial insurers who co-share loan default with the PFI in the event of enterprise insolvency. Support for the LIS insurance premium will be increased from 50% to 80% until 31 March 2021. Companies 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 or invoice or AR discounting with recourse; overseas working capital loan; banker’s guarantee
    2. Eligibility
      1. Be a business entity that is registered and physically present in Singapore
      2. At least 30% local equity held directly or indirecrly by Singaporean(s) and/or Singapore PR(s) determined by the ultimate individual ownership
      3. Group revenue of up to S$100 Million or maximum employment of 200 employees
    3. To apply: Approach Participating Financial Institutions to apply for loan backed LIS
  3. Enterprising Financing Scheme
    1. EFS enables enterprises to access financing more readily throughout their various stages of growth. It covers six areas to address enterprises’ financing needs. Enterprise Singapore will share the loan default risk in the event of enterprise insolvency with the Participating Financial Institution.
      1. SME Working Capital Loan: Finance daily operational cashflow needs
      2. SME Fixed Assets Loan: Finance the investment of domestic and overseas fixed assets
      3. Venture Debt Loan: Finance the growth of innovative enterprises using Venture Debt and Warrants
      4. Trade Loan: Finance trade needs
      5. Project Loan: FInance the fulfillment of secured overseas projects
      6. Mergers and Acqusition Loan: Finance the acqusition of target enterprises with the intent of internationalisation
    2. A higher risk share will be considered for:
      1. Young companies within 5 years from inception
      2. Markets with S&- ratings of below BBB- or are not rated
    3. Eligibility
      1. Be a business entity that is registered and physically present in Singapore
      2. At least 30% local equity held directly or indirecrly by Singaporean(s) and/or Singapore PR(s) determined by the ultimate individual ownership
      3. Have a Maximum Borrower Group revenue cap of S$500 Million for all companies
      4. *For “SME Working Capital” and “SME Fixed Assets”, SMEs refer to companies with a group revenue of S$100 Million or maximum employment of 200 employees
    4. To apply: Approach Participating Financial Institutions to apply for the loan (subject to banks’ credit approval)
  4. Temporary Bridging Loan Programme
    1. Provides access to working capital for business needs. Eligible enterprises may borrow up to S$5 Million under the TBLP, with IR capped at 5% p.a. from Participating Financial Institutions. The government will provide 80% risk-share on these loans. Eligible enterprises under the TBLP may also apply for up to 1 year deferral of principal repayment to help manage their debt, subject to assessment by the PFIs. The TBLP started in Mar 2020, and is available until 31 Mar 2021. Interested enterprises can apply directly to the PFIs.
    2. Eligibility
      1. Be a business entity that is registered and physically present in Singapore
      2. At least 30% local equity held directly or indirecrly by Singaporean(s) and/or Singapore PR(s) determined by the ultimate individual ownership
    3. To apply: Approach Participating Financial Institutions to apply for the loan (subject to banks’ credit approval)
  5. Job Support Scheme
    1. The JSS provides wage support to employers to help them retain their local employees. As part of the JSS, the Government will co-fund the first $4,600 of gross monthly wages paid to each local employee for 9 months. There are three levels of co-funding in different sectors. 75%, 50% and 25% co-funded by the government for Aviation and Tourism, Food Services and all other sectors respectively.
    2. Eligibility
      1. All employers who have made CPF contributions for their resident (Singapore Citizen and PR) employees will qualify for the payout. This is with the exception of employers in the employer exclusion list.
    3. Application is not required. IRAS will notify eligible employers by post of the tier of support and the amount of JSS payout payable to them.
  6. Productivity Solutions Grant
    1. The PSG supports companies keen on adopting IT solutions and equipment to enhance business processes. The maximum funding support level will be raised to 80% from 1 Apr 2020 to 31 Dec 2020. The scope of generic solutions will be expanded to help enterprises implement Covid-19 business continuity measures: Online collaboration tools; Virtual meeting and telephony tools; Queue management systems; Temperature screening solutions
    2. Eligibility
      1. Registered and operating in Singapore
      2. Purchase/lease/subscription of the IT solutions or equipment must be used in Singapore
      3. Have a minimum of 30% local shareholding (for selected solutions only)
    3. To apply for PSG:
      1. Visit Tech Depot on SME portal to access the list of supportable solutions and identify revelant solutions that best suit business needs
      2. For IT solutions: Get a quotation from the pre-approved vendor. For equipment: Source for the equipment and get a quotation from the vendor.
      3. Submit an application on the Business Grants Portal (BGP).
  7. Enterprise Development Grant
    1. The EDG supports projects that help Singapore companies grow and transform. The grant funds qualifying project costs (i.e. third party consultancy fees, software and equipment, and internal manpower cost). The maximum support level will be raised to 80% from 1 Apr 2020 to 31 Dec 2020.
    2. Eligibility
      1. Registered and operating in Singapore
      2. Have a minimum of 30% local shareholding
      3. Be in a financially viable position to start and complete the project
    3. To apply for ESG: Craft a project proposal (https://www.enterprisesg.gov.sg/financial-assistance/grants/for-local-companies/enterprise-development-grant/apply/pre-application)
  8. SG Together Enhancing Enterprise Resilence (STEER) Programme
    1. The programme will support funds set up by the Trade Associations and Chambers (TACs) or industry groupings, with the aim of helping businesses tide over the challenges arising from COVID-19, and to push on with transformation efforts in preparation for the economic recovery. Supportable uses of the fund include grants for business sustenance, business growth, and capability upgrading. Valid from 3 Mar 2020 to 2 Mar 2021.
    2. From 1 Apr 2020, Enterprise Singapore will match S$1 for every S$4 raised by such industry-led initiatives, up to S$1 Million per fund.
    3. *An industry grouping is defined as a group of at least five companies collaborating to set up a fund, with an independent legal entity set up and an independent 3rd party secretariat supporting the management of the fund.
    4. Eligibility/ Application: To apply for the STEER programme, interested TACs and industry groupings can submit their proposals to Enterprise Singapore. Proposals will be assessed on a case-by-case basis by Enterprise Singapore to ensure that the programme’s intent is met, and to consider operational arrangements, including the rigour of the fund management process, number of local SMEs supported, and types of assistance to be provided
  9. Startup SG Equity
    1. As part of the Startup SG Equity scheme, the government will co-invest with independent, qualified 3rd party investors into eligible startups. This scheme aims to stimulate private-sector investments into innovative, Singapore-based technology startups with intellectual property and global market potential. SEEDS Capital Pte Ltd (SC) and SGInnovate have been appointed to manage the funds under Startup SG Equity.
    2. Eligibility for startups:
      1. Be a Singapore-based company with core activities carried out here.
      2. Be incorporated as a Private Limited company for less than five years.
      3. Have paid-up capital of at least $50,000.
      4. Be able to prove substantial innovative and intellectual content for its products and/or services and applications.
      5. Have high-growth potential with clear scalability for the international market.
      6. Have identified a ready, independent third-party investor(s).
      7. Business must not be involved in the following business activities: gambling, tobacco-related products, or any other activities which are in violation of law, or against public interest.
      8. Company cannot be a subsidiary or joint-venture.
    3. Eligibility for third-party investors:
      1. The investor(s) must be able to contribute to the startup’s growth. The investor(s) should possess the management experience, relevant business contacts and/or necessary technical expertise that can value-add to the startup.
      2. The investor(s) must be prepared to invest at least $50,000 each into each startup.
      3. The investor(s) should not hold shares in the investee prior to the co-investment (for new investments).
    4. To apply:
      1. Applicants must submit a two-page executive summary and supporting documents of the business for a first-level assessment.
      2. Business plan; Financial statements or management accounts; Business ACRA; Background of potential co-investor (if avail)

Indonesia

Loan restructuring for SMEs

New stimulus controls the banking and non-banking industries’ bad loans ratio and ease loan repayments. It relaxes debt quality assessment and restructuring requirement for debtors that are hit hard by the pneumonia-like disease spread.

Banks now assess the quality of a loan worth up to Rp 10 billion based on a debtor’s timeliness in paying the loan’s principal and interest. Previously, banks also assessed the debtor’s business propsects and financial condition. Banks are also allowed to declare a good loan despite declining quality due to the pandemic and to not categorize it as a non-performing loan. The stimulus will be valid for one year until 31 Mar 2021

Eligibility: These concessions are to debtors including MSMEs. The POJK also states that these loan restructuring can only be given after the company or MSME is affected by Covid-19

To apply: All bank customers are to contact their respective banks to find out the criteria and types of relief provided by each bank.

Malaysia

  1. Special Relief Facility
    1. To provide relief assistance to more SMEs who are affected by the COVID-19 outbreak. The maximum financing rate is now lowered from 3.75% p.a. to 3.50% p.a. The enhanced SRF is available until 31 December 2020.
    2. Eligibility: SRF is only limited to SMEs adversely affected by Covid-19. SMEs affected by the MCO are eligible to apply for the SRF given that the MCO was introduced by the government to contain the outbreak of the Covid-19. SMEs are advised to call or email the PFIs to ascertain their eligibility under the SRF. All applications for financing will be subjected to the assessment by the PFIs.
    3. To apply: Approach Participating Financial Institution
  2. Automation and Digitalisation Facility
    1. To incentivise entrepreneurs to automate processes and digitalize operations to increase productivity and efficiency. Loan will be for the purchase of equipment, machinery, computer hardware and software, IT solutions and serrvices, technology support services and other intangible assets at 4.00% p.a.. The loan amount is up to RM250,000 and the tenure will be up to 7 years. The ADF is only for SMEs to finance the purchases to enhance their own productivity and efficiency.
    2. Eligibility
      1. Malaysian owned business
      2. Registered with Suruhanjaya Syarikat Malaysia (SSM) or Local Authority (LA)
      3. Eligible SMEs (SMEs involved in the production or supply of automation and digitalization services may opt for other financing)
    3.  To apply: Download and fill up the Micro Finance Application Form and send it to BSN
  3. All Economic Sectors Facility: The maximum financing rate is also reduced from 8% p.a. to 7% p.a.
  4. BSN Micro Kredit Prihatin
    1. A micro loan scheme offered to micro enterprises whose businesses are impacted by the Covid-19 outbreak. Loan will be for working capital and capital expenditure. It will be up to a maximum of RM75,000 at an I/R of 2.00% p.a.; and the tenure would be between 1 year to 5.5 years including the first 6 months of moratorium on monthly instalment. The package is open to all business sectors.
    2. Eligibility
      1. Microenterprises whose businesses are impacted by the Covid-19 outbreak
      2. Malaysian owned business
      3. Registered with Suruhanjaya Syarikat Malaysia (SSM) or Local Authority (LA)
      4. Business has been in operation for at least 6 months.
    3. To apply: Download and fill up the Micro Finance Application Form and send it to BSN
  5. BizMula-I SRF Scheme / BizWanita-i SRF Scheme
    1. A scheme to alleviate short-term cash flow problems by SMEs affected by Covid-10. For SMEs with business records of less than 4 years who require financing from RM30,000 up to RM300,000
    2. Eligibility
      1. A Malaysian-controlled and Malaysian owned (at least 51% shareholding) company or business and must reside in Malaysia
      2. Business has been registered and/or in operations for less than 4 years
      3. Key person/ successor’s age must be at least 21 years old at the point of application and maximum of 65 years old upon full settlement
      4. Business is registered with Companies Commission of Malaysia (SSM); or authorities/district offices in Sabah and Sarawak; or statutory bodies for professional service providers
      5. Maximum shareholders’ funds not exceeding RM5 million
      6. Shareholding by Public Listed Companies and Government Linked Companies (if any) in the SMEs shall not exceed 20%
      7. *BizWanita-i is a direct financing scheme catering specifically for women entrepreneurs
    3. To apply: Application form is available at all CGC’s branches or online
  6. Syarikat Jaminan Pembiayaan Perniagaan (SJPP)
    1. Scheme increase the guarantee coverage from 70% to 80% for SMEs that face difficulties in obtaining loans. Eligible SJPP borrowers also enjoy a 2% rebate on the interest rate charged by the financial institutions valid until 2022.
    2. Eligibility
      1. For SME Companies in all sectors or industries
        1. Non-manufacturing: Companies with sales turnover not exceeding RM20.0 million OR full-time employees not exceeding 75 workers
        2. Manufacturing: Companies with sales turnover not exceeding RM50.0 million OR full-time employees not exceeding 200 workers
        3. At least 51% or more shares held by Malaysian
        4. SMEs applying must be within 6 months to 2 years in operations for WCGS-SU, Mandatory site visit will be conducted for WCGS-SU
      2. Excludes:
        1. Entities that are public-listed on the main board; and
        2. Subsidiaries of: Public-listed companies on the main board; Multinational corporations (MNCs); Government-linked companies (GLCs); Syarikat Menteri Kewangan Diperbadankan (MKDs); and State-owned enterprises.
    3. To apply: Procedure for Special Relief Facility and Automation and Digitalisation Facility
  7. Wage Subsidy Programme
    1. To provide financial assistance to employers who experience more than 50% fall in revenue to enable them to retain their workers. This scheme provides RM600 for 3 months.
    2. Eligibility
      1. Employers with declining revenue of more than 50% since 1 Jan 2020
      2. The subsidy eligibility is subject to employees registered and contributing to the Employment Insurance System (EIS) with wages of RM4,000 and below.
      3. Employers shall not be allowed to terminate employees or force employees to take -pay leave for a period of 3 months after the implementation of the programme
      4. Employers shall not be allowed to cut salaries of existing employees
    3. To apply: Applications can be made by employers through www.perkeso.gov.my starting 1 Apr 2020
  8. Employer Advisory Services (EAS): To provide cashflow to employers by including options for deferral of payments, restructuring and rescheduling of employer contributions. The programme will be introduced on 15 Apr 2020.

Thailand

Credit Scheme

To help entrepreneurs directly and indirectly affected by COVID-19 through commercial banks and specialized financial institutions. Offers a special 2% p.a. for the first two years loan for entrepreneurs. Companies can borrow up to 20 Million Baht with a loan repayment period of 2 years. This programme will run till 30 Dec 2020.

Eligibility: SMEs are advised to call or email the PFIs to ascertain their eligibility under the SRF. All applications for financing will be subjected to the assessment by the PFIs.

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