Access to financing is one of the most persistent challenges for Singapore SMEs — whether managing working capital gaps, funding equipment purchases, expanding overseas, or closing a major contract. The Enterprise Financing Scheme (EFS), administered by Enterprise Singapore, addresses this challenge head-on by providing government-backed risk-sharing on commercial loans, making it easier and cheaper for qualifying businesses to borrow.
With Budget 2026 enhancements taking effect from 1 April 2026, EFS has been refreshed with revised loan limits, extended risk-share ratios, and new green financing options. This guide covers all seven EFS loan types, eligibility requirements, and how to apply.
What Is the Enterprise Financing Scheme?
The EFS is a government loan assistance scheme where Enterprise Singapore shares the default risk with participating financial institutions (PFIs) — typically banks and finance companies. This risk-sharing reduces the PFI’s exposure, allowing them to lend to SMEs at competitive rates and with less stringent collateral requirements than they might otherwise impose.
The EFS does not provide direct grants — businesses borrow from approved PFIs (such as DBS, OCBC, UOB, Standard Chartered, and others) under EFS terms. Enterprise Singapore provides the risk-share backstop.
EFS Eligibility Requirements
To qualify for any EFS loan, your business must:
- Be registered and operating in Singapore (ACRA-registered Sole Proprietorships, Partnerships, LLPs, and Companies all qualify)
- Have at least 30% local shareholding held directly or indirectly by Singapore Citizens or PRs
- Have a Group Annual Sales Turnover not exceeding S$500 million
For SME Working Capital and SME Fixed Asset loans specifically, the SME definition also requires either:
- Group revenue of up to S$100 million; or
- Maximum employment of 200 employees
The Seven EFS Loan Types
1. EFS – SME Working Capital Loan
The most commonly used EFS product, the Working Capital Loan addresses short-term cash flow needs — payroll, supplier payments, rent, and day-to-day operating costs.
- Loan quantum: Up to S$500,000 per borrower
- Loan tenor: Up to 5 years
- Government risk-share: 50% (for loans from 1 April 2026)
- Interest rate: Determined by PFI, typically 3–6% p.a. depending on credit profile
2. EFS – Fixed Asset Loan
For businesses investing in productive assets — machinery, equipment, commercial vehicles, or factory fit-outs — the Fixed Asset Loan provides longer-tenure financing.
- Loan quantum: Up to S$30 million per borrower
- Loan tenor: Up to 15 years (for land and building); up to 7 years for equipment
- Government risk-share: 50%
- Eligible assets: Industrial machinery, commercial vehicles, factory space, renovation costs
3. EFS – Trade Loan
Designed to support import/export businesses and companies with overseas supply chains, the Trade Loan provides short-term financing for trade-related transactions.
- Loan quantum: Up to S$10 million per borrower
- Loan tenor: Up to 1 year
- Government risk-share: 50%
- Eligible uses: Letters of Credit, trust receipts, invoice financing, banker’s guarantees for trade purposes
4. EFS – Project Loan
The Project Loan supports companies that have secured contracts but need upfront financing to execute — common in construction, engineering, infrastructure, and large service contracts.
- Loan quantum: Up to S$30 million per borrower
- Loan tenor: Up to 7 years
- Government risk-share: 50%
- Eligibility: Must have a confirmed contract from an approved project
5. EFS – Venture Debt Loan
Targeted at high-growth, venture-backed startups that cannot access traditional bank financing due to limited collateral or profitability history.
- Loan quantum: Up to S$8 million per borrower
- Loan tenor: Up to 5 years
- Government risk-share: 70%
- Eligibility: Must have received equity investment from a recognised venture capital or private equity investor
6. EFS – Merger & Acquisition (M&A) Loan
For businesses looking to expand inorganically through acquisitions, the M&A Loan provides financing for the purchase of equity stakes in target companies.
- Loan quantum: Up to S$50 million per borrower
- Loan tenor: Up to 5 years
- Government risk-share: 50%
- Eligible acquisitions: Must acquire at least 30% stake in target; target may be overseas
7. EFS – Green Loan
Introduced to support Singapore’s sustainability agenda, the Green Loan funds projects and assets that meet green standards — solar installations, energy efficiency retrofits, and ISO 14001 certification costs.
- Loan quantum: Up to S$30 million per borrower
- Loan tenor: Up to 15 years
- Government risk-share: 70% (enhanced to encourage green investment)
- Eligible projects: Must meet Green Building Council, Green Mark, or equivalent green certification standards
Budget 2026 Enhancements (From 1 April 2026)
As announced in Budget 2026, several EFS enhancements took effect from 1 April 2026:
- Enhanced risk-share ratios for specific loan types to encourage greater SME borrowing
- Expansion of eligible activities under the Project Loan to include more service sectors
- Continued support for the Green Loan as part of Singapore’s Green Economy strategy
Businesses should apply or reapply post-April 2026 to benefit from the enhanced terms — existing loans do not automatically convert to the new terms.
How to Apply for an EFS Loan
- Select the right loan type: Determine which EFS product matches your financing need (working capital, asset purchase, trade, project, etc.)
- Choose a Participating Financial Institution (PFI): EFS loans are applied for through approved banks and finance companies, including DBS, OCBC, UOB, Standard Chartered, Maybank, Hong Leong Finance, and others. Each PFI sets its own interest rates, documentation requirements, and credit assessment criteria.
- Prepare your documentation: Typically required: latest two to three years of financial statements, ACRA business profile, bank statements, and details of the specific financing purpose. For Project Loans, the confirmed contract must be submitted.
- Submit application to the PFI: Applications are submitted directly to the PFI (not to Enterprise Singapore). The PFI conducts its own credit assessment and applies to Enterprise Singapore for the risk-share if the loan is approved.
- Drawdown: Upon approval, the PFI disburses the loan and Enterprise Singapore’s risk-share backstop is activated for the PFI’s portion.
EFS vs Government Grants: Key Differences
It is important to distinguish the EFS from government grants such as the EDG, PSG, and MRA. Grants provide non-repayable funding co-investment; EFS provides loan assistance that must be repaid with interest. Businesses can — and often should — use both: grants to fund capability development or market expansion costs, and EFS loans to fund working capital or asset purchases alongside the grant project.
For more on combining grants strategically, see our guide on the new EDGE Grant consolidating EDG, PSG and MRA.
Conclusion: EFS Is a Powerful Tool for Singapore SMEs
The Enterprise Financing Scheme is one of the most practical and accessible financing tools available to Singapore SMEs. With government risk-sharing reducing PFIs’ exposure, businesses that might otherwise face difficulties obtaining commercial loans — especially younger companies or those with limited collateral — can access credit on workable terms.
The key is matching the right EFS product to your actual financing need, and then approaching PFIs with a well-prepared application package.
At Raffles Corporate Services, we assist Singapore SMEs in identifying and applying for the right government financing and grant programmes. Contact us to discuss your business’s financing needs.
— The Editorial Team, Raffles Corporate Services