An initiative by DBS Bank to help social enterprises offset cash flow woes caused by the coronavirus pandemic and protect jobs is gaining traction in the sector.
A $500,000 grant set up by DBS Foundation has already attracted applications from 13 Singapore-based social enterprises that employ 2,500 people in all and support about 100,000 beneficiaries.
The initiative is available to 60 foundation-supported social enterprises across Asia and comes in various forms, such as existing grants and mentorship programmes.
Successful applicants will also have access to the foundation's support network, which includes mentorship, business networking and matchmaking opportunities with the bank's clients and fellow social enterprises.
The aim is twofold - to help these organisations protect and create jobs, while also using digital tools to find new income streams to transform their operations.
DBS is also making available the collateral-free social enterprise Digital Business Loan to all 360 social enterprises registered with the Singapore Centre for Social Enterprise at an interest rate from as low as 2 per cent a year.
Ms Joyce Tee, group head of SME banking, said the financial needs of social enterprises are often overlooked by lenders as they usually do not have a borrowing history with banks or the relevant credit profiles.
This means getting access to working capital to stay afloat may be even more difficult during the economic downturn now.
All social enterprises can sign up for the bank's complimentary webinars and online courses on how they can transact, trade and manage their banking needs from home.
DBS will also provide social enterprises with a complimentary Covid-19 Business Resource Guide, which contains tips for businesses to navigate the economic uncertainty and position themselves for recovery.
Wateroam, which designs and manufactures portable water filtration systems for use in developing countries, has applied for the grant.
Chief executive David Pong told The Straits Times: "The pandemic has affected our ability to travel and deploy our systems overseas. To overcome this, we have moved towards digitalisation, including a virtual experience centre for customers and organisations to go on the ground virtually and see how the product is being deployed.
"Sales and marketing are also being shifted online, from real-life exhibitions to webinars and online training platforms.
"The grant will be of great help in defraying the costs of such digitalisation that is necessary for us to continue operating during times like these."
Mr Alfie Othman, chief executive of the Singapore Centre for Social Enterprise, said favourable loan terms will give social enterprises cash flow options as they endeavour to save jobs.
"We recognise that any aid extended to businesses to ease the strain on cash flow will keep them operational for a longer time, thus giving them the much needed runway to bounce back and retain jobs in the process," he said.
