WITH effect from today, all small and medium enterprises (SMEs) will get free help to navigate loan paperwork.
Spring Singapore has launched a new Financial Facilitator Programme (FFP) aimed at helping SMEs apply for loans under recently enhanced government financing schemes.
The process of credit assessment can be daunting, said Spring chief executive Png Cheong Boon. 'Common feedback from the banks is that many SMEs are unable to present their case to the banks,' he said. 'There is often a gap between SMEs' expectations and the requirements of the banks.'
The FFP will be available through Enterprise Development Centres (EDCs) and EnterpriseOne Business Information Service (EBIS).
Mr Png said EDCs and EBIS, which were specially set up to help SMEs, are in a better position to understand and facilitate the financing needs of SMEs.
The FFP was jointly initiated by five EDCs - at the Association for Small and Medium Enterprises, the Singapore Chinese Chamber of Commerce and Industry, the Singapore Indian Chamber of Commerce and Industry, the Singapore Malay Chamber of Commerce and Industry and the Singapore Manufacturers' Federation - and EBIS at the Singapore Business Federation.
Under the FFP, with support from Spring, the six centres have engaged financial advisers to help SMEs with financing strategies and loan applications.
The assistance covers diagnosis of an SME's financial health, financial management and various financing options, and putting together a loan application with supporting documents.
The Association for Small and Medium Enterprises has hired a private sector financial consultancy to facilitate the FFP, which association president Lawrence Leow believes will help those SMEs that already have a 50:50 chance of getting a loan.
'Some will just need help with finding the right type of loan,' he said.
Still, he added, a business that can put up some form of security stands a better chance of getting a loan approved.
OCBC Bank's global head (enterprise banking and financial institutions) Linus Goh said: 'The SME business is an important segment for us and we will continue to support our SME customers. We welcome this initiative by Spring and the EDCs to support SMEs at this time.'
A UOB spokesman said every loan application is considered carefully, taking into account factors like a company's business viability, cashflow and track record.
'This is important not just for the bank but also for customers, as loans should be a means to help them manage their business better and should never become a burden for them,' the spokesman said.
This article was first published in The Business Times on January 12, 2009.
