The SME Working Capital Loan is a government-supported scheme offered by Enterprise Singapore to help small and medium-sized enterprises (SMEs) meet their working capital needs. The SME Working Capital Loan provides financing of up to S$500K per borrower, with a repayment period of up to five years. The loan can be used to cover various operating expenses, including inventory and stock, wages, and rent. Interest rates ranges between 4% – 5.6% flat per annum depending on the bank and company’s profile.

One of the key advantages of the SME Working Capital Loan is that it comes with a government risk-sharing feature. Under this feature, the government provides a risk-sharing of up to 50% on the loan to help lenders mitigate the risk of default. This makes it easier for SMEs to access financing, especially those that may not have strong profiles or credit history.

In 2023, banks in Singapore have revised their parameters, which require businesses to disclose all government-assisted loans that they have taken in the past. This may make it challenging for some SMEs to obtain the SME Working Capital Loan if they have previously taken other government-assisted loans.