Despite the Covid-19 situation, companies are still on the look to widen their businesses, increase productive capacity or expand overseas and utilize bigger grants and expanded loan schemes, which is extremely attractive to businesses.
These grants and loan schemes will benefit and provide additional support to businesses during trying times and aid them to transform such as having up to 80 per cent of qualifying costs covered from 1st November 2020 to 30th September 2021, an increase from the current 70 per cent, under the Market Readiness Assistance Grant with the enhancements to several grants and loan schemes on Monday (as announced on Oct 12).
With the extent of the grant’s coverage, it motivates companies to involve and participate in virtual trade fairs enabling them to find new overseas opportunities. Adding onto that, retailers will also be able to expand their reach overseas using online platforms and exploring new opportunities. This grant is extended for another 9 months from 1st January 2021, where Enterprise Development Grant (EDG) and Productivity Solutions Grant (PSG) will cover up to 80 per cent of qualifying costs until 30th September 2021, after which, it will cover up to 70 per cent.
From 1st January 2021, more assistance will be readily available for businesses seeking loans such as construction companies as they will be able to apply for loans to subsidize the fulfilment of secured domestic projects with at least half of the risk shared by the Government, but will end on 31st March 2022.
The Temporary Bridging Loan Programme (TBLP), which provides access to working capital at a lower interest rate, and a financing scheme for trade loans will also be extended by 6 months to 30th September 2021. Adding onto that, the maximum loan amount for the Bridging Loan Programme will also be lowered from $5 million to $3 million which aids them to adapt to the new reality.
Both schemes will see the Government’s risk share lowered from 90 per cent to 70 per cent from 1st April.
The Monetary Authority of Singapore (MAS) said in a separate statement on Monday that it extended its low-cost facility by 6 months to support lending to SMEs from 1st April 2021 to 30th September 2022, complementing the extension of the Temporary Bridging Loan Programme (TBLP), which offers Singapore-dollar funding at an interest rate of 0.1 per cent per annum for a 2-year tenor to eligible banks and finance companies for loans under TBLP and the Enterprise Financing Scheme – SME Working Capital Loan.
Since its introduction in April, the facility has donated a total of $5.7 billion to financial institutions in support of their lending to companies under various loan schemes, the central bank added.
Enterprise Singapore said that the schemes help different sized companies depending on their needs. The Productivity Solutions Grant (PSG), for example, is more suited for smaller companies that need readily-available solutions, it said.
The table below shows the Support scheme enhancements:
Despite all the grants and schemes, the retail sector faces a bumpy road to recuperation, the sector had already been facing structural challenges before the pandemic, such as the rise of e-commerce and the need for transformation and restructuring concepts, as well as experiences after visiting SK Jewellery’s headquarters in Changi Business Park.
Retail sales were already suffering an unprecedented a year-on-year drop of 52.1 per cent in May when shops were forced to shut, while sales have been on the rebound since shops have been allowed to reopen, takings were still down 5.7 per cent year-on-year in August.
Outlining three ways the retailers can transform to survive to ensure customer confidence and maximising constrained purchasing power would be:
The first way is by adjusting to new consumer behaviours and create new selling propositions, such as SK Jewellery which has its line of lab-grown diamonds, launched last year, caters to younger consumers who are increasingly conscious of the environmental and social impact of their purchasing decisions, to do this, the business needs to undergo the study of analytics of the company using Google Analytics and by also identifying current trends and being able to implement it to the brands’ products and designs.
The second way is stating that retailers cannot solely depend on domestic sales as they should leverage programmes such as the Grow Digital Initiative to expand abroad without the need for a physical presence, which shows that they need to digitalize their brands in order to stay relevant and keep up with the trends.
And the third way is that retailers should create value through intangibles such as service and design to help set their brands apart, to ensure this, customer service should be of main priority to the business. An example would be having a return policy, easy navigation of the website, and a chatbot for assistance.
With Covid-19 in place, businesses need to learn and adapt to the new normal by digitalization and also tapping on new schemes and subsidiaries to ensure their business remains relevant.
Are you interested to learn more about these grants and how can it be implemented into your company with MAXIMUM BENEFITS? Sign up for our FREE virtual zoom consultation now! No obligations.
We will be able to show you how with PrimeHR, you will be able to EXPAND your business’s reach!
(CLICK HERE!) to register your interest we will be in touch!
Should you require assistance please call us at +65 6334 4328.