Relief measures to help individuals and small and medium-sized enterprises (SMEs) with cash flow difficulties will be extended into next year.

This is intended to give those who have applied to defer loan repayments more time to resume their debt servicing, said the Monetary Authority of Singapore (MAS) yesterday, in its joint announcement with The Association of Banks in Singapore and the Finance Houses Association of Singapore.

The measures are also available to those who have not applied to defer payments previously, but are now facing cash flow challenges.

The extended relief will allow both individuals and businesses to transition gradually to full loan repayments, as the central bank and the financial industry recognise that many will continue to experience cash flow pressures into early next year, MAS said.

But it urged borrowers who are able to resume paying loan instalments in full to start doing so from Jan 1 next year.

"We want to continue providing relief to borrowers facing cash flow challenges while encouraging them to resume loan repayments to the extent they are able to, so that they do not accumulate too much debt," said MAS managing director Ravi Menon.

"A good outcome is one where individuals and SMEs are able to use the support measures to help them tide through the current economic difficulties and emerge with a sustainable debt burden as the economy recovers," he added.

RELIEF FOR INDIVIDUALS

Measures for which the application period has been extended to June 30 next year include converting credit card balances to a lower interest term loan.

Those who are unable to resume full loan repayments on their property loans may apply to make reduced instalment payments pegged at 60 per cent of their monthly instalment, for a period of up to nine months. Individuals servicing renovation and student loans may also apply to extend loan tenures by up to three years.

Eligibility criteria for these two measures include proof of income loss.

DBS Bank has approved some 9,000 home loan repayment relief applications amounting to $5.2 billion so far, while OCBC Bank has approved more than 8,000 mortgage, car and renovation loan relief applications totalling over $5 billion.

United Overseas Bank has received more than 8,000 applications to defer mortgage repayments and more than 4,000 applications to convert unsecured debt into lower-cost term loans. It said it approved the majority of them.

RELIEF FOR SMEs

Further support has also been made available to SMEs, by allowing the deferment of loan repayment beyond the end of this year.

Under previously announced measures, companies could apply to defer principal repayments on their secured loans granted by banks or finance companies until Dec 31 this year.

The Extended Support Scheme - Standardised will allow businesses in sectors most affected by the Covid-19 pandemic to defer 80 per cent of principal payments until June 30 next year.

This applies to SMEs in the following sectors: aviation and aerospace, tourism, hospitality, conventions and exhibitions, built environment, licensed food shops and food stalls, qualifying retail outlets, arts and entertainment, marine and offshore, as well as land transport.

Firms in other sectors can apply to defer 80 per cent of principal payments until March 31 next year.

Loans granted under Enterprise Singapore's enhanced working capital loan scheme and temporary bridging loan programme are also eligible for deferment.

A customised support scheme to facilitate multi-lender restructuring, for firms where the standardised scheme is not suitable, is also being developed by banks and finance companies.

This Extended Support Scheme - Customised is intended to complement other restructuring assistance schemes, such as the Ministry of Law's proposed Simplified Insolvency Programme, MAS said.

Applications for both support schemes will open on Nov 2.

Further details on the relief measures can be found at the website.