Are you looking for a short-term financing option that can support your business needs for cash flow during this pandemic? Temporary Bridging Loan Programme (TBLP), just like a standard bridging loan can be of great help to your business.
With the impact of COVID-19 on various business sectors in Singapore, the Government has provided support by introducing loan programs that can help businesses survive. And, among these government-assisted loan is the Temporary Bridging Loan Program. Its main goal is to provide working capital to Singapore Companies thriving due to this pandemic.
To further uncover TBLP, let us read this article. We will provide the things that you need to know when it comes to Temporary Bridging Loan Programme.
What is Temporary Bridging Loan Programme?
Temporary Bridging Loan Programme or TBLP is a government-assisted financing scheme for SMEs. Introduced during the Solidarity Budget in 2020, it provides access to working capital to qualified businesses in Singapore.
Previously the maximum loan quantum granted was $5M with about 90% risk-sharing for the application period until March 31. Currently, there are new parameters that you must know. Also, please read the succeeding content to learn more about the Temporary Bridging Loan Programme.
| Extended Application Period | 1 April – 30 September 2021 |
| Maximum Loan Quantum | S$3M |
| Interest Rate | Capped at 5% p.a. |
| Maximum Repayment Period | 5 years |
| Government Risk Sharing | 70% |
| Number of Participating Financial Institutions (PFI) | 19 PFI |
| Eligibility Criteria | Registered Businesses in Singapore |
What is the extended application period for TBLP?
Enterprise Singapore has announced the extension of the Temporary Bridging Loan Programme from 1 April 2021 to 30 September 2021.
What is the maximum loan amount granted?
The new parameter allows businesses to gain access to working capital of up to $3 million. Please note that borrowers are subject to the overall borrower group limit of S$20 Million for TBLP.
What is the Temporary Bridging Loan interest rate?
Temporary Bridging Loan Programme may vary according to participating financial institutions and capped at 5% per annum effective rate.
What is the maximum repayment period for TBLP?
Businesses can spread the repayment period within five years. To manage their cash flow, they can apply for deferment for one year. But, this is subject to approval by the specific financial institution.
What do you need to know about risk-sharing?
For business applying this 1 April 2021 to 30 September, 2021the risk shared to the government is about 70%, previously it was 90%. And, the higher risk-sharing percentage allows banks to provide higher chances of loan approval.
Even though the government will be taking 70% of the loan risk in the event of default, borrowers are still responsible for 100% payment of loan outstanding. And, in the case of default, banks or financial institutions will still follow their recovery process before getting the claim from Enterprise Singapore.
What are the eligibility criteria to qualify for TBLP?
As stated by Enterprise Singapore, borrowers must have the following:
- A local business that is registered and physically present in Singapore. These are ACRA registered Sole Proprietorship, Partnership, Limited Liability Partnerships, and Companies.
- Must have at least 30% local equity which is held directly or indirectly by Singaporean(s) and/or PR(s) – determined by the ultimate individual ownership.
- Other requirements are determined or subject to participating financial institutions.
Where you can apply for Temporary Bridging Loan?
Currently, there are a total of 19 participating financial institutions under the Temporary Bridging Loan Programme. Just remember that your application is subject to the bank’s credit approval.
Can you take out another under extended TBLP when you have previously taken a TBL or EFS loan?
As answered by Enterprise Singapore from their FAQs, businesses can still take the TBLP loan under the extended programme and it will follow the capped of a maximum loan amount of S$3 million. Also, they can still apply for EFS loans on top of TBLP loans.
Can you apply for multiple TBLP loans under varying PFIs?
Also, as shown in their FAQ, they mentioned that an enterprise can still apply for different banks or PFI. However, it will follow that the total aggregate loan amount must not be more than S$3 million.
Why do Participating Financial Institutions still require a 100% Personal Guarantee?
As mentioned earlier, although the government will share the risk of about 70%, you are still required to provide a 100% personal guarantee. This will not only signal security but shows commitment by the guarantor(s) wherein they are fully committed to their liability.
Let Us Help You with Your Bridging Loan Needs?
Aside from Temporary Bridging Loan, MoneyIQ Singapore can help you find the right lender for your working capital needs through our bridging loan application. When you are not eligible, let us help you find the best option for your working capital needs. We can also help you when it comes to business loan needs. You may use the respective application form to find the right lender.
