<TABLE id=msgUN cellSpacing=3 cellPadding=0 width="100%" border=0><TBODY><TR><TD id=msgUNsubj vAlign=top>
Coffeeshop Chit Chat - Bogus Govt Scheme to help SMEs</TD><TD id=msgunetc noWrap align=right>
Subscribe </TD></TR></TBODY></TABLE><TABLE class=msgtable cellSpacing=0 cellPadding=0 width="96%"><TBODY><TR><TD class=msg vAlign=top><TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR class=msghead><TD class=msgbfr1 width="1%"> </TD><TD><TABLE cellSpacing=0 cellPadding=0 border=0><TBODY><TR class=msghead><TD class=msgF noWrap align=right width="1%">From: </TD><TD class=msgFname noWrap width="68%">kojakbt22 <NOBR>
</NOBR> </TD><TD class=msgDate noWrap align=right width="30%">3:04 am </TD></TR><TR class=msghead><TD class=msgT noWrap align=right width="1%" height=20>To: </TD><TD class=msgTname noWrap width="68%">ALL <NOBR></NOBR></TD><TD class=msgNum noWrap align=right> (1 of 4) </TD></TR></TBODY></TABLE></TD></TR><TR><TD class=msgleft width="1%" rowSpan=4> </TD><TD class=wintiny noWrap align=right>4031.1 </TD></TR><TR><TD height=8></TD></TR><TR><TD class=msgtxt>Business Times - 17 Dec 2008
<!-- head starts here-->[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1][/SIZE][/FONT]
[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1]Banks reluctant to lend despite govt schemes: companies
[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1]By CHEW XIANG [/SIZE][/FONT](SINGAPORE) Over $2 billion in government funding support for local companies hasn't managed to clear the credit clog, said participants at a seminar yesterday organised by the Singapore Manufacturers' Federation.
The seminar, featuring presentations by Spring Singapore and DBS Bank, was to publicise the government's recently enhanced financing schemes for SMEs and to get feedback from companies.
Participants - mostly from small and medium-sized companies and from the manufacturers' federation - said credit lines were still being pulled and that applications for the various schemes weren't getting approved by banks, which remain reluctant to lend.
Just 7 per cent of SMEs benefited from government-funded financing schemes, according to the recent SME Development Survey 2008 report.
This is despite the government assuming up to 80 per cent of the default risk for several schemes, as well as increasing the amount that could be borrowed through participating financial institutions.
One consultant, who specialises in arranging business funding for smaller companies, said a number of the 14 or so financial institutions participating in Spring Singapore's funding schemes were turning away applications as they had no money to lend. 'There seems to be a gap between what Spring is trying to achieve and what the banks are doing,' he said.
Seah Hwee Kia, vice-president of enterprise banking at DBS Bank, assured the seminar that the bank's 'credit criteria have always been the same considerations whether it's boom time or downturn,' adding that in marginal cases, 'if there is a risk sharing factor (by the government) that might incentivise the bank to take a little more risk.'
He urged businessmen to work with their bankers and to provide detailed business plans. 'To the bank, cash flow is very important. We also want to know what you are doing to mitigate the conditions,' he said.
Others questioned what they said were high application and processing fees charged by banks - $500 or one per cent of the amount sought, whichever is higher - in some of the schemes.
Mr Seah said businesses should consult their bankers - in some cases such fees could even be waived, and if fees were levied there was a 'good chance' the loans would be approved, he said.
Chew Mok Lee, group director of enterprise promotion at Spring Singapore, said the agency was monitoring applications received for its various funding schemes and is working closely with banks involved.
Its Enterprise Development Centres would try to help small companies with the application process, which some participants said was onerous. 'We will also be working with the MTI to maybe adjust or look at the interest rates (charged),' she added.
[/SIZE][/FONT][email protected]
</TD></TR></TBODY></TABLE></TD></TR></TBODY></TABLE>
<!-- head starts here-->[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1][/SIZE][/FONT]
[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1]Banks reluctant to lend despite govt schemes: companies
[FONT=Geneva, Helvetica, Verdana, Arial, sans-serif][SIZE=-1]By CHEW XIANG [/SIZE][/FONT](SINGAPORE) Over $2 billion in government funding support for local companies hasn't managed to clear the credit clog, said participants at a seminar yesterday organised by the Singapore Manufacturers' Federation.
The seminar, featuring presentations by Spring Singapore and DBS Bank, was to publicise the government's recently enhanced financing schemes for SMEs and to get feedback from companies.
Participants - mostly from small and medium-sized companies and from the manufacturers' federation - said credit lines were still being pulled and that applications for the various schemes weren't getting approved by banks, which remain reluctant to lend.
Just 7 per cent of SMEs benefited from government-funded financing schemes, according to the recent SME Development Survey 2008 report.
This is despite the government assuming up to 80 per cent of the default risk for several schemes, as well as increasing the amount that could be borrowed through participating financial institutions.
One consultant, who specialises in arranging business funding for smaller companies, said a number of the 14 or so financial institutions participating in Spring Singapore's funding schemes were turning away applications as they had no money to lend. 'There seems to be a gap between what Spring is trying to achieve and what the banks are doing,' he said.
Seah Hwee Kia, vice-president of enterprise banking at DBS Bank, assured the seminar that the bank's 'credit criteria have always been the same considerations whether it's boom time or downturn,' adding that in marginal cases, 'if there is a risk sharing factor (by the government) that might incentivise the bank to take a little more risk.'
He urged businessmen to work with their bankers and to provide detailed business plans. 'To the bank, cash flow is very important. We also want to know what you are doing to mitigate the conditions,' he said.
Others questioned what they said were high application and processing fees charged by banks - $500 or one per cent of the amount sought, whichever is higher - in some of the schemes.
Mr Seah said businesses should consult their bankers - in some cases such fees could even be waived, and if fees were levied there was a 'good chance' the loans would be approved, he said.
Chew Mok Lee, group director of enterprise promotion at Spring Singapore, said the agency was monitoring applications received for its various funding schemes and is working closely with banks involved.
Its Enterprise Development Centres would try to help small companies with the application process, which some participants said was onerous. 'We will also be working with the MTI to maybe adjust or look at the interest rates (charged),' she added.
[/SIZE][/FONT][email protected]
</TD></TR></TBODY></TABLE></TD></TR></TBODY></TABLE>
