Business Loans

Budget 2020: Banks Have Lowered Interest Rates for Government-backed Business Loans by 50%!

Eric Koh
April 2, 2020

*Updated as we receive more information from our partner financiers

Disclaimer: This article is based on information that Lendingpot has received informally from partners. Interest rate information is usually not published on banks' websites. All the information is believed to be accurate; however, no claims, promises or guarantees about the accuracy, completeness or adequacy of the information are made. All information, commentary, recommendations or statements of opinion provided in this article are for general information purposes only. We do not claim to be authoritative. If there are any errors in our reporting, please contact for rectification.

In response to the government’s call for financial institutions in Singapore to provide urgent assistance to companies, several local and foreign banks in Singapore have lowered their effective interest rates for government-backed business loans.

The rates will be effective from 1st April 2020 and will apply to the Temporary Bridging Loan Programme (TBLP) and the Enhanced Enterprise Financing Scheme – Working Capital Loan (EFS-WCL) offered by Enterprise Singapore’s partner financing institutions (PFIs).

(Updated 6th April 2020)

Under the Solidarity Budget announced on 6th April 2020, the government announced that banks and finance companies may apply for low-cost funding through a new Monetary Authority of Singapore (MAS) Singapore Dollar facility, for new loans granted under the EFS-WCL and TBLP.

Lowering the cost of funds will lower the interest rate costs of new government-backed loans issued through the PFIs.

(Updated 20th April 2020)

On 20th April 2020, the MAS and Enterprise Singapore (ESG) announced that the new facility will lend Singapore dollars at 0.1% interest per annum to eligible financial institutions.

PFIs are expected to pass on the cost savings to SMEs, lowering the cost of the government-backed EFS-WCL and TBLP.

This is the main reason that we’ve seen new government-backed loans offered at these low interest rates from the start of April.

Government-backed Business Loans - Interest Rate Table

*All rates displayed are effective interest rates (EIRs).


(Before Budget 2020)

(After Budget 2020)

(After Budget 2020)
DBS 6 – 9% 3.75% 3%


  • 1% facility fee
  • no facility fee
  • Up to 12 months principal moratorium avail.
UOB 6.5 – 7% 4.5 – 5.75%


3.5 – 4.5%

3% (2.5% negotiable)


  • 2% or $500 facility fee, whichever is lower (negotiable)
OCBC 6 – 8.88% 3% 3%

1.5% (1 or 2 year tenor)

2.5% (3 to 5 year tenor)

  • 1% facility fee or $500, whichever is higher
  • no facility fee

  • 6 months or 12 months principal moratorium avail.
CIMB 6 – 9% 3.75% 3%
  • No facility fee for both
  • 6 months or 12 month principal moratorium avail.
RHB 7.5 – 9.5% 5.5 - 6.5% Max 5%
  • $500 facility fee
Standard Chartered 6.5 – 8% 4.25 - 7.5% 3.75 - 4.25%
  • 2% facility fee

TBLP = Temporary Bridging Loan Programme
EFS-WCL = Enterprise Financing Scheme - Working Capital Loan
All rates displayed are Effective Interest Rates (EIRs)
Last updated on 11th May 2020

This is great news for SMEs!

Some of the interest rates of these loans have been lowered by half!

This will not only be useful for struggling SMEs that are trying to obtain cash flow to survive this downturn, but is also a great opportunity for better-positioned SMEs to obtain affordable capital for expansion opportunities for the eventual economic recovery from the COVID-19 pandemic.

This is in addition to other initiatives already announced for SMEs in Singapore, such as higher government-backed business loan limits (announced in the supplementary budget on 26th March) and that SMEs can defer their principal payments for property loans (announced by MAS on 31st March).

Request for a Business Loan Now! operates a Business Loan Marketplace that allows an SME to connect to multiple lenders with just one application, allowing the SME to know who its prospective lenders are and the rates that they offer, in a very short time.

Leading digital loan marketplace Lendingpot connects SMEs to its network of 45 lenders comprising relationship managers from banks, financial institutions, and private and peer-to-peer lenders in Singapore. It aims to help SMEs overcome the information asymmetry problem and lack of transparency prevalent in the SME financing sector by offering SMEs financing options such as business term loans, property loans, revenue-based financing, credit lines, working capital loans, bridging loans, invoice financing, and more.

About the author

Eric Koh is passionate about helping SMEs grow and has spent years interacting with business owners at OCBC and IFS Capital. He is interested in 70s rock ‘n roll, the odd novel and copious amounts of historical trivia.

Budget 2020
business loan
SME Loan
Lowered Interest Rates

You may also like