SINGAPORE - More help is on the way for companies hit by the fallout from the coronavirus outbreak with six business families in Singapore setting up a $5 million kitty to extend short-term loans.
Local small and medium enterprises (SMEs) whose business have been affected by the virus outbreak can use the fund for working capital loans for up to 12 months, a Singapore Business Federation statement said on Thursday (Feb 20).
The fund, called Helping Our Promising Enterprises (Hope), is the work of the industry association's young business leaders network. It was set up by Goldbell Group, Super Group founder's investment firm Apricot Capital, Ho Lee Group, Paradise Group, Sing Lun Group and Soilbuild Group.
The Hope fund is one of the latest measures announced by companies, including banks, to help beleaguered companies tide through the challenges presented by the virus outbreak.
Relief measures ranged from offers to restructure loans to the extension of moratorium on principal repayment for loans.
The network's chair Chong Ee Rong said the fund is "one way that our members can contribute and help tide over our fellow SMEs in need"and that it hopes to rally other companies to participate.
"There is no doubt that Singapore will overcome this trying time, but how we help each other through, will shape our future," she said.
The fund will be open for applications on Wednesday (Feb 26), and it ams to help more than 100 companies.
Companies can also expect to receive their working capital loan within 24 hours once approved.
Alex Chua, CEO of Goldbell Financial Services, said, "We understand the urgency of the situation and have constructed a credit scoring model for this programme, allowing loans to be approved quickly and to be disbursed within 24 hours from loan approval, subject to the required documentation received."
The fund will offer a fixed loan of $50,000 per company, and will offer lending rates starting at 0.5 per cent per month, but at no more than 0.75 per cent per month.
Industry rates for working capital loans can vary widely, typically ranging between 7 to 18 per cent per annum.
It also allows a deferment of the loan principal and interest repayment to start from the third month onwards.
Processing fees will cost $80 to cover administrative charges, and is the lowest in the market, according to The Business Times.
To qualify, companies must be locally incorporated for more than 12 months, have at least 30 per cent Singaporean shareholding and a minimum paid-up capital of $25,000.
The matching of borrowers to monies will go through Goldbell Group's private debt investment platform, Goldbell Evolution Network, which is developed and owned by Goldbell's financial services arm.