Small and medium enterprises (SMEs) are a major driving force behind Singapore’s economy. According to Singstat, SMEs made up 99% of all companies in Singapore, employing 71% of the workforce, and contributed 44% of nominal value.
The importance of the sector isn’t lost on the government, which has rolled out several support measures and enterprise grants. Let’s take a closer look at the grants and financing schemes that SMEs can tap into to further their business capabilities and development.
Related: Resource Page For SMEs and Startups in Singapore
Related: Could a Business Line of Credit Help My SME?
| Name of grant or scheme | Key details |
|---|---|
| Energy Efficiency Fund (E2F) | Aims to help manufacturing SMEs improve emergency efficiency.
Funds up to 70% of qualifying costs. |
| Productivity Solutions Grant (PSG) | Supports companies in the adoption of IT solutions and equipment to enhance business processes.
Funds up to 50% of qualifying costs. |
| Enterprise Development Grant (EDG) | Supports business owners in innovation, upgrading and growing their businesses.
Funds up to 50% of qualifying costs (up to 70% for sustainability-related initiatives till March 2026). |
| Business Improvement Fund (BIF) | Supports tourism-focused enterprises in business improvement projects.
Funding granted depends on the merits of the proposal. |
| Market Readiness Assistance (MRA) | Helps companies seeking to expand overseas.
Funds up to 70% of qualifying costs, up to S$100,000 per company per new market. |
Energy Efficiency Fund (E2F)
Administered by: National Environment Agency
E2F is for SMEs in manufacturing looking to reduce their carbon footprints by switching to more efficient or greener energy sources. It funds up to 70% of eligible costs, including external manpower, equipment or technology and professional services.
Eligibility
- Be a Singapore-registered owner or operator of a manufacturing facility sited in Singapore with SSIC code 10XXX to 32XXX
- With annual group sales turnover not exceeding S$500 million
- Installation and use of pre-approved energy efficient technologies or other technologies with proven track record of energy savings
- With proven energy savings
- Project must not have commenced at the time of application; once approved, must conclude within 36 months
Productivity Solutions Grant (PSG)
Administered by: Enterprise Singapore
PSG is aimed at helping businesses improve their operations and processes through the use of IT and tech solutions. Applicants may choose from a list of pre-scoped solutions for the one that best fits their objectives and needs. Up to 50% of eligible costs are funded under this scheme.
Eligibility
- Registered and operating in Singapore
- Purchase/lease/subscription of the IT solutions or equipment must be used in Singapore
- Have a minimum of 30% local shareholding; with Company’s Group annual sales turnover less than S$100 million, OR less than 200 employees (for selected solutions only)
Additionally, further funding may be granted under the SkillsFuture Enterprise Credit scheme if the following are met:
- Have contributed at least S$750 Skills Development Levy over the qualifying period
- Have employed at least three Singapore Citizens (SCs) or Permanent Residents (PRs) every month over the same period
- Have not been qualified for SFEC at any of the earlier periods
Enterprise Development Grant (EDG)
Administered by: Enterprise Singapore
EDG is perhaps the widest-ranging SME grant available, being applicable for a slew of business improvement initiatives from core capabilities like Business Strategy Development, Human Capital Development and Strategic Brand & Marketing Development, to innovation and productivity-related factors such as Automation and Process Redesign.
Successful applicants can expect up to 50% funding for third-party consultancy fees, software and equipment, and internal manpower costs. For projects related to sustainability, funding is capped at 70% of eligible costs, up till March 2026.
Eligibility
- Business entity registered and operating in Singapore
- Company has at least 30% local equity held directly or indirectly by Singaporean(s) and/or Singapore PR(s), determined by the ultimate individual ownership
- Company is financially ready to start and complete the project
Business Improvement Fund (BIF)
Administered by: Singapore Tourism Board
This grant is reserved for SMEs dealing in tourism or travel and related operations. It aims to encourage technology innovation and adoption, and the redesign of business models and processes for improved productivity and competitiveness. The level of funding is evaluated based on the merits of the proposal.
Eligibility
- Tourism companies taking on capability development initiatives
- Technology companies that create innovative technology products and services for tourism businesses
- At least 30% local shareholding,
- Group annual sales turnover not more than S$100 million; OR group employment size not more than 200 employees
Market Readiness Assistance (MRA)
Administered by: Enterprise Singapore
SMEs looking to expand their businesses overseas can consider applying for the MRA, which provides up to 70% funding of eligible costs. Note that this is capped at S$100,000 per company per new market, with sub-limits for overseas market promotion (S$20,000); overseas business development (S$50,000) and overseas market set-up (S$30,000).
Eligibility
- Business entity is registered/incorporated in Singapore
- New market entry criteria, i.e. target overseas country whereby the applicant has not exceeded S$100,000 in overseas sales in each of the last three preceding years
- At least 30% local shareholding
- Group annual sales turnover of not more than S$100 million; OR Company’s Group Employment Size of not more than 200 employees
Related: Explaining Government Grants for SMEs
Tips for Starting Up Your Own Business Enterprise
Now that you’ve learnt about some of the business grants available, you may be tempted to have a go at starting your own business. Here are a few tips for you.
Keep It Simple
Distinguishing yourself from the competition is critical to success, but don’t go overboard and make your business overly complicated. If you can’t explain your business concept to a five-year-old, then the general public isn’t going to get it. After all, customers won’t buy from you if they don’t understand what you’re selling.
Work Out Your Capital
Besides a clear business plan, entrepreneurs also need to have a firm grasp on capital and cashflow. In the course of your business, you may need to manage inventory, ramp up marketing, even expand your operations when the opportunity presents itself. However, lacking a proper budget can hinder you from taking the necessary steps, which can throw your business into a spiral that’s hard to get out of.
Pick the Right Entry Point
It’s not necessary to jump full-time into your business from the get go. You can start off as a side hustle first, honing and refining your product or service, and your brand’s market positioning, while building up a core group of loyal customers. Take the time to understand the nuances of your segment, such as seasonality, which can cause fluctuating demand levels. Only switch your business to full-time operation when you’re ready in both experience and finances.
Finding investors can be difficult, especially at the beginning. A business loan can provide seed capital to accelerate your business plans. Read our recommendations of the best business loans in Singapore to find an ideal loan for you.
Read More:
- How Do SME Loans Work And Should I Get One As A Business-Owner?
- Can Digital Banks in Singapore Resolve SME Financing Needs?
- 4 Key Factors to Keep In Mind to Secure Your SME Loan in Singapore
- 5 Ways to Make Customer Experience a Priority for Your SME
- 6 Ways for SMEs to Adapt to Rising Wages in Singapore
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