Debated in Parliament on 6 Feb 2017.
Mr Liang Eng Hwa asked the Minister for Trade and Industry (Industry) (a) what is the number of applications and utilisation rate of the SME Working Capital Loan Scheme since its introduction in 2016; (b) whether SMEs face cash flow concerns or inability to obtain funding for their business growth; and (c) whether there are plans to enhance the attractiveness and availability of the scheme.
The Small and Medium Enterprises (SME) Working Capital Loan was announced at Budget 2016 to help viable SMEs access working capital and continue growing their businesses. The scheme complements existing Government loan schemes and commercial loans offered by financial institutions. Since its launch in June 2016 to December 2016, the SME Working Capital Loan has catalysed more than $700 million in loans, benefiting approximately 4,300 SMEs.
Based on the 2016 DP Information Group SME Development Survey, 96% of SMEs which applied for Government and commercial working capital term loans of five years and below were successful in their applications. This comprised 79% which received the full amount requested, and 17% who received partial approved amounts.6
Of the approved loans under the SME Working Capital Loan, 82% are less than the maximum quantum of $300,000. The current scheme is therefore sufficient to meet the needs of most applicants. The Government has regular meetings with the financial institutions and chambers and associations to understand and monitor the financing needs of SMEs and is prepared to provide greater assistance if necessary.
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