Financing scheme enhanced for firms devising green solutions

A financing scheme has been beefed up to support Singapore companies that develop green technologies.

The Enterprise Financing Scheme-Green is targeting firms that devise solutions to reduce waste, resource use and greenhouse gas emissions, Enterprise Singapore (ESG) said.

The scheme, which started last Friday and will run until March 31, 2024, supports financial institutions in lending to firms by undertaking risk sharing of 70 per cent.

Funding will go to sectors such as clean energy, circular economy, green infrastructure and clean transportation.

The scheme will also aid with a range of financing needs, including developmental capital, fixed assets, trade, project, venture debt, and mergers and acquisitions.

ESG chief executive Png Cheong Boon said: "Demand for green solutions is set to grow globally as countries and industries strive to set practices and targets to control the adverse impact that emissions have on global warming.

"The scheme is meant to enable green technology innovators in Singapore to have easier access to green financing, in order to create ever-evolving, ever-improving solutions."

He noted that such companies will be those pushing new boundaries and bearing additional risks in enabling technologies for the transition towards a green economy.

Such actions in turn will help other enterprises adopt green solutions and capture opportunities globally.

The Enterprise Financing Scheme-Green is being supported by partner financial institutions, including DBS Bank, HSBC, OCBC Bank and UOB.

Ms Joyce Tee, DBS' group head of SME banking, said: "While awareness on green and sustainability imperatives is fast gaining traction, we have observed that many small and medium-sized enterprises (SMEs) still consider these to be the remit of larger companies.

"ESG's introduction of the scheme is timely and it will help convince more SMEs to embark on their green and sustainability journeys."

Ms Regina Lee, HSBC Singapore's head of commercial banking, added: "The firms of the future will be those with the foresight to mitigate and adapt now in order to thrive.

"The scheme... will channel capital towards eligible businesses that are working towards the shift to a lower-carbon economy."

Mr Linus Goh, OCBC's head of global commercial banking, noted that the bank has seen strong interest from SMEs seeking to start and accelerate green initiatives despite disruptions from Covid-19.

Mr Eric Tham, UOB's head of group commercial banking, added: "The scheme exemplifies public-private partnerships that broaden enterprises' strategic horizons beyond Singapore."