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The SME Working Capital Loan is a financing scheme where the risk is shared between the Singapore Government and the respective issuing bank. Jointly administered by Enterprise Singapore and pariticipating banks, it enables businesses and SME’s to access unsecured working capital for cashflow or business expansion.

“We must continue to support the growth
of our enterprises, and as they mature,
drive deeper transformation.”
– Heng Swee Keat, Budget 2020 Speech

1. What is the Working Capital Loan?

The SME Working Capital Loan (“WCL”) is an increase over the SME Micro Loan. As the Micro Loan is capped at S$100,000, the working capital loan allows businesses to access cheaper capital over the S$100,000 limit. As the risk is shared between the bank and the government, this allows lenders greater security to grant loans to growing businesses in Singapore.

The WCL Loan can be used for business expansion, cashflow, payment for goods, purchase of goods from suppliers, financing daily operations or the growth of companies

2. What is the criteria to apply?

The criteria for applying for the SME Working Capital Loan is as follows

Company TypeSole Proprietors, LLPs and Private Limited companies are eligible to apply
ShareholdingAt Least 30% owned by a Singaporean or Permanent Resident
Incorporation LengthSubject To Bank’s AssessmentTo find out more about this criteria, please make an enquiry here.

All businesses with at least 30% Singaporean or Permanent Resident shareholding qualify except Listed companies. Incorporation Length is subject to bank, and some banks require a longer or shorter incorporation length.

3. How and Who do I apply to?

To apply the following documentation is required, but not limited to

Documentation TypeRequired?
6 months company bank statementsYes
2 Years Profit Loss and Balance SheetsYes
2 Years Director’s Notice of Assessment (Income Tax)Yes
Director’s NRICYes
Signed Application FormYes

The loan amount is calculated based on the incoming cash flow, outgoing transactions and average daily balance among other things. Other requirement such as Credit Bureau and Personal Income tax plays a part in the assessment process.
Lastly, a write-up or justification for the purpose of the loan in required. Should you be applying through Equity, we will do this for you.

Are you lacking or unsure of the documentation required? Click here for a specialist to do the work for you.

4. The participating lenders in
the SME Working Capital Program are as follows

CIMB Bank Berhad
DBS Bank Ltd
Ethoz Capital Ltd
Hong Kong and Shanghai Banking Corporation
Hong Leong Finance Ltd
IFS Capital Ltd
Maybank Singapore Ltd
ORIX Leasing Singapore Ltd
Oversea-Chinese Banking Corporation Ltd (OCBC Bank)
Resona Merchant Bank Asia Ltd
RHB Bank Berhad
Sing Investments & Finance Ltd
Singapura Finance Ltd
Standard Chartered Bank
United Overseas Bank Ltd

These lenders above are all participating in the SME Working Capital Loan by the Singapore Government. However, each lender has their own further qualifying criteria. For instance, a business might qualify with Lender A, but be rejected by Lender B and vice versa. The qualifying criteria for each lender changes constantly so do check back from time to time if you are not eligible the first time.

5. How much Can I Loan?

With the new Enhanced Budget, SME’s can now loan up to S$1,000,000 in unsecured working capital up from the previous amount of S$600,000. This is useful for businesses seeking additional cashflow or for business expansion. There is no collateral required for the loan and the Singapore Government shares 90% of the risk between the banks.

The actual loan amount will be calculated based on the last 6 months of your business’s bank statements along with other relevant criteria.

6. The long can I loan for?

The maximum tenure that you can loan for is 5 years or 60 months. With the enhanced working capital loan, you are also able to request for 1 year or 12 months of principle free repayments, so you only have to pay the interest for the first year.

An illustration of the repayments are in the table below

Loan PeriodTotal AmountInterest Rate (%)Monthly Repayments*
5 Years$100,00031800
4 Years$100,00032216
3 Years$100,00032911
No Early Repayment Penalty

*monthly repayments might vary and are subject to change

There is also no early repayment penalty so what this means for businesses is that they can pay off the loan at any point of time and the total interest will be only be accured up to the point of payoff.

So, business owners can take a 5 year tenure period, for lower monthly payments, and pay off after 1 or 2 years to save on interest.

7. What are the interest rates like?

Interest Rates start at 3% effective. The interest rate is determined by the lender and might vary from lender to lender. Equity Capital Solutions can assist you to identify the lender with the lowest rate and provide a smooth and seamless application. Please click here to have a specialist assist you.

8. What happens if I decide to pay early?

Congrats! You’ve decided to pay off your loan early. To find out the exact loan amount payable, you’ll have to first do the following.

  1. First call the business care number of the lender your loan Is with
  2. Next, let them know and verify your business details
  3. Once that is done, they will calculate the outstanding loan amount and the total amount due up till date.
  4. You have to make payment at the branch of either the full amount or multiples of S$1,000
  5. If you make full payment, the loan is concluded and no other payments are required
  6. If you make partial repayments, the loan and interest is recalculated based on the amount outstanding

9. What if I need more than the amount approved?

Businesses have a global loan limit of up to S$1,000,000 in SME Working Capital. Businesses are also able to apply to more than one lender.

For example, Lender A approves a WCL Loan at $200,000 and you require more. You can apply at another lender for the additional loan amount you need. If you require more than S$1,000,000 you can apply for the Temporary Bridging Loan (“TBL” ) which goes up to S$5,000,000 or the Business Term Loan offered by banks

10. Enhanced Working Capital Loan 2020

The enhanced working capital loan increases the amount from S$600,000 to S$1,000,000 for qualifying businesses. Supported by Enterprise Singapore and the Singapore Government, 90% of the risk will be shared between the banks. This gives better access to credit for businesses for operations and cashflow during the COVID-19 slowdown.

11. What happens if I don’t qualify?

Don’t qualify for the Working Capital Loan? Don’t worry! Businesses still have access to SME Micro Loan and Business Term Loan. Equity Capital Solutions can assist to identify why the your application was not eligible for the WCL and assist you again for a successful application.

For greater credit amounts up to S$5,000,000, you might want to explore applying for the Temporary Bridging Loan.


In summary, the Working Capital Loan is another important initiative by the Singapore Government and Banks to assist SMEs. The interest rate is low and it supports a principle deferment scheme for up to 1 year. There is also no early repayment fee. This makes it a versatile and flexible loan option for businesses in Singapore. The Enhanced Working Capital Loan lasts until 2021, so if you’d like to get a higher loan amount, it is necessary to apply before then.

How It Works

  • Make a Free Enquiry.
  • An Equity financing specialist will reach out to you for some simple details.
  • We work together with you for the documentation.
  • You relax and we do the heavy lifting for you.
  • We contact you when its approved for signing down the loan.