SME Financing in Singapore: Bridging, Business & Working Capital

sme bridging loan singapore

Getting an SME bridging loan in Singapore should not be challenging for any eligible business. This is primarily because the government, through Enterprise Singapore, has established various bridging and business loans to help local businesses with the cash flow they need to go about their operations.

These loans have different requirements; however, since they are government initiatives, they have low-interest rates and are available to businesses located in Singapore. Additionally, the government has a risk share in any loans the participating financial institutions offer.

How Can Business Loans Help SMEs?

Business loans provide operational cash flow for enterprises that might face difficulties operating due to the current economic conditions. The fact that there are government-initiated bridging loan programmes with lower interest rates and relatively long repayments periods makes the cost of acquiring such loans low.

Challenges SMEs Face

The main challenge facing most businesses in Singapore is the complex economic condition brought about by the COVID pandemic. Due to this, enterprises have had to face difficulty keeping their businesses afloat due to insufficient working capital.

Another challenge is finding low-cost loans to boost their working capital. Some loan options have a low maximum loan quantum, a high rate, and a shorter repayment period. Also, loan approval criteria are not always favourable to most businesses.

What Is SME Bridging Loan?

SME bridging loans are designed to provide a temporary solution to businesses during periods of difficulty. These business loans are given out to companies so that they may stay afloat long enough for their situation to change for the better.

They do this by providing the working capital a business needs to continue its operations. 

Available Bridging Loans In Singapore

There are mainly two types of SME loans available for businesses in Singapore. The main ones are those that the government initiated and cover a certain percentage of the risk share involved when PFIs fund loans to local businesses. These tend to be popular since they offer a low cost of obtaining a loan.

The other type is those offered directly by banks and licensed moneylenders. These loans may have a higher cost since the government does not cover the risk involved in financing the loans; that responsibility solely lies with the financial institution offering the loan. Below is a rundown of the available bridging loan options:

Temporary Bridging Loan(TBL)

The Temporary Bridging Loan Programme (TBLP) is an enhanced enterprise financing scheme established by the government of Singapore to provide bridging loans to local businesses. There are participating financial institutions that fund loans given under the programme. The scheme parameters are as flows:

  • Available only to businesses that are physically present in Singapore and are registered with ACRA. Also, the company must have been in Singapore for at least six months before applying.
  • The government covers a 70% risk share of the loan amount, and the PFIs approve and fund the loans.
  • The maximum loan quantum is 1M for businesses, while for business groups is a maximum of 20M.
  • The Interest rate is capped at 5.5%.
  • 30% or more of the equity must be owned by citizens or permanent residents of Singapore.
  • The latest end date for the programme is 30 September 2022.

SME Working Capital Loan (WCL)

SME Working Capital Loan is among the loans under the EFS (Enterprise Financing Scheme) umbrella by Enterprise Singapore. The government introduced EFS in 2019 to streamline the different business financing schemes provided by Enterprise Singapore. Apart from Working Capital Loan (WCL), other financing schemes under EFS include Fixed Asset Loan, EFS Green, Project Loan, Mergers and Acquisitions Loan, Trade Loan, and Venture Debt Loan.

WCL is an excellent way for entities to get operational cash flow to fulfil their business needs. Some of the parameters of the Working Capital Loan include:

  • Available to SMEs with 200 or fewer employees or a revenue up to 100M.
  • A maximum loan quantum amount of $300,00 for each borrower. However, borrower groups can access 5M.
  • The repayment period is five years.
  • The government’s risk share is 50% of the loan amount.
  • Business must be physically present in Singapore, and ACRA approved.
  • The PFIs provide approval and funding for loans.
  • The interest rate is determined by PFIs.

Standard Bridging and Business Loans

Most of the standard bridging loans offered by banks in Singapore are tailored through businesses or individuals with assets that want to acquire new ones. This way, the company must put in an initial down payment of about 5% of the new asset’s total price, plus a second down payment of 20% of the asset price, and get the rest as a bridging loan.

Unlike EFS bridging loans, these standard bridging loans have a shorter payment period, and the interest rates tend to be slightly higher. Since each bank has its credit criteria, there are dissimilarities in eligibility and requirements.

If you’re looking for a faster disbursement of cash and lenient requirements with usually no credit checks, licensed moneylenders offer business loans up to $200,000 with repayment terms of up to two years. 

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Which Bridging Loan Should You Get?

The choice between a Temporary Bridging Loan (TBL), Working Capital Loa n(WCL) and Standard Bridging and Business Loan depends on the loan’s suitability to your business needs. To further help you understand the differences, how each loan can help your business, and the eligibility requirements, here is a comparison table of the three.

Comparison Table Of The Three

  Temporary Bridging Loan (TBL) Working Capital Loan (WCL) Standard Bridging & Business Loan
Interest Rate Capped at 5.5% Set by the PFI (can be up to 6%)
  • Set by banking Institution (most start from (5-8%)
  • Set by licensed moneylenders (5-15%)
Maximum Loan Quantum 1M for businesses and 20M for borrower groups 300,000 for borrowers and 5M for borrower groups
  • LTV of 75% of the asset you are buying (amount can range be upwards of 1M depending on the financial institution, e.g., OCBC Banks)
  • Moneylenders can lend up to $200,000
Repayment Period Five years

Five years

  • Up to six months.
  • For moneylenders, usually from 12 to 24 months
Administering Institution Enterprise Singapore (Under the Enterprise Financing Scheme) Enterprise Singapore (Under the Enterprise Financing Scheme)
  • Bank or moneylending institution giving the loan
Purpose of Loan Provide cash flow for business operation Provide working capital
  • For asset acquisition

Temporary Bridging Loan (TBL) – Best For Businesses Looking For Cash Flow Up To 1 Milion

Businesses looking for a temporary loan of up to 1M and borrower groups looking to access up to 20M should opt for TBL from the EFS. However, it is essential to note that the programme is slated to end on 30 September 2022.

Eligibility And Requirements

Here are some of the eligibility and requirement parameters for the Temporary Bridging Loan Programme:

  • Any businesses located in Singapore with more than six months of operation.
  • The loan amount should not exceed 1M for enterprises and 20M for borrower groups.
  • At least 30% of the equity of the business or borrower group should be owned by PR (permanent residents) or citizens of Singapore.
  • Personal Guarantee to be given to PFI funding the loan.

How To Apply: Step-By-Step Application Process

  1. Download the form from the EFS site, or get one from the PFI of your choice.
  2. Fill in the form and attach relevant documents.
  3. Provide the duly filled-in form to the PFI.
  4. Wait for approval from the PFI (credit approval criteria set by each PFI).
  5. If approved, you will get a Letter of Offer from the PFI, and funds will be disbursed once you accept the offer.

SME Working Capital Loan (WCL) – Best For Businesses Looking For Working Capital Up To $300K

SME Working Capital Loans are a good option for businesses that have 200 or fewer employees and have a revenue not exceeding 100M (and 500M for borrower groups)

Eligibility And Requirements

  • The business must have been operating for at least six months and is physically present in Singapore.
  • Permanent residents or citizens of the country should own 30% or more of the equity in the business.
  • The loan should not exceed $300K for businesses and 5M for borrower groups.

How & Where To Apply

  • You can apply from any of the WCL scheme participating financial institutions.

Step-By-Step Application Process

  • Download the necessary forms from the EFS portal, or get them from any PFI.
  • Fill in the form and provide the required supporting documents before submitting your application to a PFI.
  • Once you get the Letter of Offer and accept it, the fund will be released.

Standard Bridging and Business Loan – Best For Businesses Looking For Short-Term Loans 

Businesses can apply for standard bridging and business loans at various banks and institutions of lending if they are looking for short-term solutions to acquire new assets.

Banks Eligibility And Requirements

  • Available to business owners from 21 to 65 years.
  • You already have assets in the HDB market that you are looking to sell.
  • Put down a total of 25% of the total cost of the new asset to be acquired
  • Permanent residency or citizenship in Singapore.
  • Additional eligibility requirements might be required by your banks or lending institution.

Moneylenders Eligibility And Requirements

  • At least 21 years old
  • Minimum turnover of $60,000
  • Business must be operating for at least 1 year
  • All directors and partners NRIC
  • Most recent information report (Business Profile) from the Accounting & Corporate Regulatory Authority
  • Most recent Income tax assessment notice (both personal and from the company)
  • Most recent financial statement
  • Most recent invoices or business contracts
  • Most recent utility bills under the company name
  • Most recent 6-month bank statements
  • List of assets owned by the company, directors & partners (if any)
  • Office / Shop Tenancy Agreement (if any)

How And Where To Apply

You can apply to different banks or institutions that offer standard bridging loans. Examples of these include Standard Chartered Bank, OCBC Bank, A1 Credit, among others.

Step-By-Step Application Process

Please follow the application procedure by your bank or moneylending institution of choice.


1. Can A Business Get A Bridging Loan?

Yes. There are different bridging loan options under the EFS umbrella. Most need the business to operate for at least six months. The company must be physically present in Singapore and is approved by ACRA.

Each type of bridging loan offered by Enterprise Singapore has its parameters and requirements. It is therefore essential to read each kind of loan to determine which business entity qualifies for and is the best fit.

2. Do You Need An Income For A Bridging Loan?

Yes. However, you will be required to secure that loan using a property or asset you intend to sell.


Depending on your business loan needs, options are available in the financial market. The most common options are the Temporary Bridging Loan Programme (TBLP), the SME Working Capital Loan (WCL), and standard bridging and business loans from money lenders and banks.

  • WCL and TBLP loans have more extended repayment periods than the standard bridging and business loans.
  • TBLP and WCL fall under the purview of the Enhanced Financing Scheme by Enterprise Singapore, while individual lending institutions are responsible for the standard bridging loans they offer.
  • TBLP and WCL loans are excellent for businesses looking to boost the cash flow, while standard bridging loans are ideal for companies looking to acquire new assets.
  • While the Singapore government covers a certain percentage of the risk sharing in WCL and TBLP loans, it does not do so for standard bridging loans.

With many SME loans available, choosing the right one for your business can sometimes be confusing. Contact us or fill out the quick form on the website to request a free loan quote and choose your best option.

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