Navigating COVID-19 Part 2: Tackling Cash Flow, Cost, and Credit for Every Business in Singapore

Cash Flow

COVID-19 has accelerated into a global pandemic. There are now only three “Cs” on the mind of every business owner in Singapore, which is cash flow, cost, and credit. To put these concerns at ease, the Singapore government has introduced measures as part of the Resilience Budget in support of businesses. Here is an overview of what your business can expect.


1st ‘C’: Cash Flow

For businesses, ‘cash is king’, and many have called for more timely assistance. Besides improving your business cash flow, read on for new wage support schemes and tax deferment measures.

  1. Enhanced Job Support Scheme (JSS)

    The Jobs Support Scheme (JSS) has been enhanced to help you retain your local employees. All employers and representative offices are eligible for the JSS.

    Higher support levels: Employers will now receive a 25% cash grant (up from 8%) on the first SGD 4,600 (up from SGD 3,600) of the gross monthly wages of each local employee on their Central Provident Fund (CPF) payroll.

    Longer support duration: The JSS will be extended to cover nine months of wages (up from three months). This will be paid in two additional payouts in July and October 2020.

  2. Wage Credit Scheme (WCS)
    If you have increased the wages of your Singapore Citizen employees in 2019 and 2020, the government will be co-funding the wage increases by 20% and 15% instead of 15% and 10% respectively. The qualifying gross wage ceiling will also be raised to SGD 5,000 for both years.
  3. Automatic deferment of income tax payments

    To further ease cashflow as businesses await cash from the above wage support schemes, companies and self-employed persons will be granted an automatic deferment of income tax payments for 3 months. No application will be required.

2nd ‘C’: Costs

The Government has introduced measures to support businesses on business costs that are within the Government’s control.

  1. Property Tax rebate
    More types of properties will be eligible for Property Tax rebate. Commercial properties such as hotels, serviced apartments, tourist attractions, shops, and restaurants paying no Property Tax, while offices and industrial buildings will be granted a Property Tax Rebate of 30% for the year 2020.

    Landlords are required to fully pass on the rebate to tenants in the form of monetary payment or reduction in rentals to directly ease the cash flow and cost pressures faced by tenants. For more details, please refer to Part 1 of Corporate Services Singapore’s “Navigating COVID-19” series.

  2. Rental waivers
    If you own a stall in a hawker centre managed by the National Environment Agency (NEA), 3 months of rent will be waived. For selected tenants under other government agencies, 2 months of rent will be waived.

3rd ‘C’: Credit

Financing schemes in Singapore will be further enhanced such that even the hardest-hit businesses will continue to have access to credit.

  1. Enterprise Financing Scheme Trade Loan

    To provide companies with better access to trade financing amidst the current environment of slower business activities and longer payment cycles, the Government will enhance the Enterprise Financing Scheme (EFS) Trade Loan further with 90% risk share, up from 70%. The maximum loan quantum is also raised from SGD 5 million to SGD 10 million. Borrowers are still responsible for repaying 100% of the loan amount.

  2. Loan Insurance Scheme

    Does your business need a short-term trade financing loan? Subsidies to businesses for loan insurance premiums will be increased from 50% to 80% under the Loan Insurance Scheme. This enhancement will help businesses across all industries reduce trade financing costs.

  3. Temporary Bridging Loan Programme
    If your business requires access to working capital, you may borrow up to SGD 5 million instead of SGD 1 million under the Temporary Bridging Loan Programme, with an interest rate capped at 5% per annum. The Government will provide 90% risk-share on these loans for new applications initiated by 31 March 2021. Borrowers are still responsible for repaying 100% of the loan amount.
  4. SME Working Capital Loan
    If you need support beyond the above loans, you can tap on the SME Working Capital Loan. The maximum loan quantum for this will be further enhanced, from SGD 600,000 to SGD 1 million.
  5. What your Business Can Do in the Meantime

    As Singapore prepares for recovery, businesses should continue to make use of this downtime to digitalise, restructure, and transform. Besides applying for the above business administration loans, you may leverage on government schemes such as the Productivity Solutions Grant (PSG) and the Enterprise Development Grant (EDG) as you adopt new digital solutions or advanced systems.

    Consider renegotiating the terms of existing contracts and debts. For instance, ask for a longer repayment period, or defer interest payments on outstanding debts. If you are a large business with deep reserves, you can help small businesses by paying outstanding bills quickly.

    Adjust your sales pitch and design your marketing around how to address new customer challenges and worries. For instance, are your customers facing a shortage of key inventory due to panic buying, or are they worried about supply chain disruptions? Reposition your products and services in order to address these pain points.

    You can also choose to increase corporate efficiencies in terms of business process improvements to get ready for the post-coronavirus recovery. At Corporate Services Singapore, we can help you strengthen your company’s internal practices. Our team of experts will enhance your business processes and provide innovative business solutions to strengthen your overall organisation business framework. For companies undergoing financial hardship, we can help you renegotiate delinquent debts and work out a compromise with creditors, or make formal insolvency arrangements on your behalf.

    By taking proactive steps now, you can put your business in a more secure position to stay strong and recover faster once the crisis subsides. To grow your business by focusing more on what matters, call us at 6602 8286 or email us at

Posted in Accounting.