Fintech company Validus Capital has joined Singapore banks to offer government-backed loans under an Enterprise Singapore (ESG) scheme. The firm secured approval this week to offer small and medium-sized enterprises (SMEs) financing that has up to 90 per cent of the risk taken up by the Government.

A Validus spokesman said the company is using data analytics to assess the credit-worthiness of applicants for the Enterprise Financing Scheme by accounting for their pre-and post-Covid-19 performance. Among other things, Validus also screens SMEs for litigation processes or those with bankruptcy proceedings against directors.

It expects to dole out mainly working capital loans over the next six to nine months.

Validus also estimates that it will stick with the usual loan size of between $50,000 and $300,000 for each SME. The tenures are likely to be slightly shorter than those of banks, the company's spokesman said.

Validus Capital will use its balance sheet to fund the loans under ESG schemes. This means these loans cannot be funded by peer-to-peer investments.

"A lot of SMEs are bouncing back stronger as the economy opens up," the spokesman said.

Co-founder and chief executive Nikhilesh Goel said: "Through these... schemes, we look forward to playing a much larger role in addressing the financing needs of underserved SMEs and those impacted by the pandemic."

THE BUSINESS TIMES