Interest Rate at 0.1% To Help Banks Lower Cost To SMEs


As of Apr 20th. the Monetary Authority of Singapore (MAS) has launched the MAS SGD Facility for ESG Loans with Enterprise Singapore (ESG). This was set up to help make loans to business borrowers more affordable, which will process loans to eligible banks and financial institutions at an interest rate of 0.1% per annum for a two-year tenor.


This is to support their loans to businesses under the ESG Loan Schemes, which comprises of SME Working Capital Loan (EFS-WCL) and the Temporary Bridging Loan Programme (TBLP).


By providing banks and financial institutions funding at the low-interest rate, the facility reduces the cost of funds for loans made under the ESG Loan Schemes. This will help SMEs manage their cash flow better amidst the current COVID-19 pandemic.


The Facility will help financial institutions to make loans to SME borrowers more affordable. in terms of pricing.


The Facility also reinforces MAS efforts to ensure ample SGD funding to banks in Singapore, by maintaining a high level of SGD liquidity in the banking system, so that they can continue to play their role in providing credit to individuals and businesses in Singapore.


However, as all being said, it does not mean it will be a guaranteed loan to all SMEs. There are still stringent crediting criteria to fulfil.


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