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How government grants and schemes can help SMEs in 2022
As the Singapore economy rebounds post-pandemic, SMEs can gear up for brighter horizons this year. In Budget 2022, the government announced a refreshed slew of grants and support schemes to power business innovation. Forward-thinking SMEs can easily tap into these initiatives to support their recovery and future-proof their business.
“We will accelerate our investments in new capabilities to power our next stage of growth,” said Finance Minister Lawrence Wong. These investments include a S$500 million Jobs and Business Support Package and a generous S$600 million to scale up the Productivity Solutions Grant, along with a S$200 million sum dedicated to digital transformation.
All these add up to good news for small businesses with big ambitions. To help you find the help you need, here’s an overview of the grants and schemes that SMEs can benefit from in 2022.
Loans for Businesses
For SMEs with plan to expand but lack the necessary funding, the following support schemes extend loans that you can repay in instalments.
- Enterprise Financing Scheme (EFS): This umbrella scheme by Enterprise Singapore covers financing for businesses across seven areas, throughout various stages of your growth. Improve your operational cash flow with the SME Working Capital Loan, and finance your trade needs with the recently extended Trade Loan. Firms looking to acquire local or overseas enterprises can get a boost with the enhanced Mergers & Acquisitions Loan.
- Temporary Bridging Loan Programme (TBLP): Now extended till 30 September 2022, the TBLP offers quick access to working capital for your immediate cash flow needs. Businesses can borrow up to S$1 million through participating financial institutions like UOB, with interest rates capped at an affordable 5.5% p.a.
Grants for Digital Transformation
As SMEs grapple with rising costs and manpower crunch, going digital holds the key to boosting productivity. SMEs Go Digital is an umbrella programme designed to spur SMEs’ digital adoption, with resources ranging from digital start packs to funding support. This includes:
- Productivity Solutions Grant (PSG): For companies adopting digital solutions to automate their workflows, this grant offers funding for up to 70% of the cost. It covers sector-specific solutions like retail, food, logistics, construction, and precision engineering, along with cross-sector areas such as customer management, data analytics, financial management, and inventory tracking.
- Advanced Digital Solutions (ADS): Forward-thinking SMEs can tap into the ADS to deepen their digital capabilities and build future readiness. Funding support covers up to 80% of the adoption costs for advanced technologies like AI and blockchain, as well as integrated solutions.
Grants for Overseas Expansion
For local companies planning to expand their global footprint, the government offers support through a range of grants and resources.
- Enterprise Development Grant (EDG): The EDG provides funding for Singapore companies that aim to strengthen their core capabilities, innovate, or expand into overseas markets. From 1 April 2022 to 31 March 2023, the programme will cover up to 80% of qualifying project costs.
- Market Readiness Assistance (MRA) Grant: For SMEs looking to venture abroad, this grant offers a much-needed financial boost. You can get funding for up to 70% of eligible costs related to overseas market promotion, business development, and market set-up, capped at S$100,000 per company per new market.
- Grow Digital: A scheme under the SMEs Go Digital programme, Grow Digital focuses on helping SMEs sell overseas through e-commerce. SMEs can benefit from smart matching with overseas clients, access to financing offers facilitated via e-commerce platforms, and skills training in cross-border e-commerce.
Training Programme Funding
Lifelong learning is more crucial than ever in the current fast-changing world, and the government offers a series of incentives to support upskilling. Keep your team’s skills sharp and boost your manpower with these subsidised training programmes.
- Enterprise Leadership for Transformation (ELT): This one-year programme is targeted at helping SME business leaders hone their business growth capabilities. Leaders will learn to develop a customised business growth plan, study market assessment strategies, and even go on a market immersion trip. Eligible enterprises can benefit from up to 90% funding of programme fees.
- SkillsFuture Career Transition Programme (SCTP): Newly launched in Budget 2022, the SCTP offers training support for those pivoting to new sectors or roles mid-career. Full-time and part-time courses will be progressively rolled out from April 2022, focusing on sectors with strong hiring opportunities such as Infocomm technology and advanced manufacturing. Subsidies are available for up to 90% of course fees.
- SGUnited Mid-Career Pathways Programme: Now a permanent initiative, this attachment programme helps mid-career individuals develop new, in-demand skills. Those aged 40 and above can join attachment programmes and receive training with host organisations for up to six months. Trainees will earn a monthly allowance of up to S$3,800, with 70% of that funded by the government.
Financial Support for Manpower
Manpower shortage remains a key concern for small businesses in 2022, compounded by rising labour costs. To ease your labour woes, take advantage of these schemes and grants to retain and recruit employees.
- Progressive Wage Credit Scheme (PWCS): Introduced in Budget 2022, the PWCS aims to help businesses uplift their lower-wage workers. From 2022 to 2026, the government will co-fund wage increases up to a S$2,500 gross monthly wage ceiling, starting with a 50% co-funding ratio in 2022. For wage increases up to a S$3,000 gross monthly ceiling, co-funding support will run from 2022 to 2024.
- Small Business Recovery Grant (SBRG): This new grant offers cash support to businesses in sectors hard-hit by COVID-19 restrictions – namely F&B, retail, tourism, and hospitality. Businesses will receive a S$1,000 payout for each local employee from June 2022.
- Jobs Growth Incentive (JGI): Now extended to September 2022, the JGI supports companies’ efforts to hire more Singaporeans in this challenging labour market. In Phase 4, the scheme is exclusive to persons with disabilities, ex-offenders, and mature local persons aged 40 and above who have been unemployed for at least six months. For these new hires, the government will co-pay 40% of the first S$6,000 in gross monthly wages for the first six months, and 20% for a subsequent six months.
- Aviation Workforce Retention Grant (AWRG): To help the aviation industry recover post-pandemic, the government is providing extended wage support to aviation companies till September 2022. The grant will cover 10% of local employees’ wages from April to September this year, with a cap of S$4,600 of gross monthly wages per employee.
With the right funding, business growth is easier
With further easing of community and re-opening of our borders, the year ahead looks packed with new challenges and opportunities for SMEs. Coupled with these support schemes, it will power your business growth and stay future-ready in exciting times.
Looking for an SME-friendly loan to improve your cash flow? Find out more about UOB’s Temporary Bridging Loan programme here.
"This article was adapted from Really Singapore (www.really.sg), a premium Software-as-a-Service (SaaS) platform with an integrated B2B marketplace for digital procurement and workflow automation. This article was last updated on 25 April 2022."
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