Q: I intend to expand my company overseas. Are there any loan schemes available to help fund my expansion? How do I qualify for such schemes and what are the terms of the loan?

You can tap on the Internationalisation Finance (IF) Scheme by IE Singapore, which makes available $500 million worth of loans to support companies' expansion overseas.

The IF Scheme aims to address the issue of limited access to financing for overseas expansion, with IE Singapore bearing 70 per cent of the default risk for the participating financial institutions. It is meant to encourage these institutions to be more prepared to extend the loans.

Loans are available to help companies fund expenses or as working capital for secured projects and orders. They can also be used to acquire fixed assets for use overseas.

To qualify for the scheme, companies must be registered in Singapore and have at least three headquarter (HQ) functions here. Its group turnover should not exceed the following:

• $200 million for non-listed companies; 
• $500 million for non-listed trading companies; 
• $100 million for listed companies 
• $200 million for listed trading companies.

In addition, the overseas business must complement the Singapore-based company's activities and result in economic spin-offs for Singapore.

HQ functions refer to activities such as banking and finance, marketing and business planning, procurement/logis- tics, training and personnel management, investment planning/coordin- ation/research and development, technical support and manufacturing.

A group is defined as the company and its directly-owned subsidiaries and associate companies. A business is considered a trading company if it derives more than 50 per cent of its turnover from trading activities.

The quantum of financing can be up to 90 per cent and the maximum loan limit per group is $15 million. The interest rates and collateral requirement are determined by your participating financial institution.

To apply, please contact the following participating financial institutions:

• ABN Amro Bank 
• DBS Bank 
• GE Commercial Financing 
• Hong Leong Finance 
• IFS Capital 
• Maybank 
• Orix Leasing Singapore 
• OCBC Bank 
• Standard Chartered Bank 
• HSBC 
• United Overseas Bank

For inquiries, please visit www.business.gov.sg or e-mail enterpriseone@spring.gov.sg

This article was first published in The Straits Times on 2 July 2008.