Virus-battered smaller businesses flood banks with loan applications

Fresh data from DBS showed that the bank saw a year-on-year doubling of government-assisted SME loans and total loan quantum disbursed in March 2020.

Similarly at UOB, head of group commercial banking Eric Tham said the bank has seen a"significant increase" in SME working capital loan applications in March, with"the majority" approved. Overall, SME working capital loans approved by UOB in March grew close to 60 times from a year ago. Mr Tham said that given the higher risk-sharing by the government, UOB has been able to extend loans to more SMEs, including those that may have previously been ineligible. It will also consider companies in operation for fewer than three years or startups that are not yet profitable on a case-by-case basis, he added.

This comes even as banks are now given more leeway by the Monetary Authority of Singapore to support lending activities and as the government ups its risk-share for several enterprise loans to 90 per cent. The bank did offer loan deferment options, but he noted that interest will still accumulate. Mr Kwok added that he is going to try other banks for help.

Another SME that is waiting on the banks is Alan Lee, co-founder of gift retailer Klosh. According to him, he submitted requests two weeks ago for deferred payments for SME loans, but has yet to hear back from them even after following up.

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