What is the impact of COVID-19 on business loan in Singapore? The happening of COVID-19 affected the economy of the entire world. For instance, in Singapore, there was S$17.4 billion that more than 20,000 business enterprises had to borrow for effective business operations. This happened between March and December 2020 whereby the ESG- Enterprise Singapore approved the business loan to help entrepreneurs manage their business in the midst of COVID-19 happenings.
According to Chan Chun Sing, the Trade and Industry Minister, this was a new record compared to the previous year where they released only S$1.3 billion to support business operations.
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What is the purpose of the business loan?
The purpose of the massive business loan during COVID-19 was to sustain business owners and companies to pursue their business goals and functioning despite the pandemic pressure. This was Mr. Chan’s statement to the reporters on a visit to wholesale trade firm PS energy, responsible for lubricants and fuel distribution.
With the ESG, which falls under Temporary Bridging Loans Program schemes, the ESG incurs 90% of the total risks involved, like loan. This allows financial departments to improve the terms and conditions of the services.
Wholesale trade making up 20% of extended business loan
The Trade and Industry Ministry said that wholesale trade makes up to 20%of the extended loans, the manufacturing sector makes 13%, and the construction department makes about 16%. The remaining percentage falls under retail trade and other services. This was after media questions concerning the extended business loan to businesses.
Furthermore, Mr. Chan said that among the significant challenges affecting wholesale traders and company operations were cash and credit flow.
To add to that, he said that they aimed to improve the activities of the companies as they prepare to unleash new and more extensive opportunities in the coming days.
The wholesale trade industry, jobs and business loan
In Singapore, the Ministry of Trade and Industry has over 320,000 jobs to offer, and this equals 9% of the entire country’s labor force. Since it is a broad sector, there are over 50,000 companies under the wholesale trade. It contributes about 12%of Singapore’s GDP-Gross Domestic Product.
According to Mr. Chan, the industry brings more value to the country’s economy, especially after the COVID-19 happening.
The respective people in the economy sector are devising ways to promote economic recovery and develop strategies to help various industries thrive.
They intend to bring out the schemes slowly as the economy recovers. However, they aren’t focusing on specific industries alone. They are extending more strategic plans to other sectors to see the country’s entire economy back to normal again.
The economic sector during such hard times
In such hard times, the government is still positive that all the economic sectors will regain their capabilities. After talking to the industrial controllers, they hope to do all the possibilities to see the industry back at its normal operations again.
However, he noted that the changes in regional and global changes in the supply chain would affect the entrepreneurship industry, posing challenges and great opportunities at the same time.
According to him, apart from business loan, the government can help businesses speed up their operations by upgrading technological aspects of transparency and traceability. The advanced technology will revolve around implementing artificial intelligence and how to analyze data when it comes to pricing strategies. The idea is to help them stay ahead of the competition and perform better.
He went further and noted that they hope to promote company buildup as they have done for institutions like PS energy. They used various strategies like taking part in the scaling up of the program. In the end, they managed to change the wholesale trade operations, where they do not only focus on margins attained from arbitrage activities but also the transformation of the entire wholesale activities.
What value does the service bring to the business?
The question then comes in, what value does the service bring to the business? When the government agency decides to help companies grow with the business loan. They understand that such enterprises play a significant role in their economies. That is why they will implement strategies to see the sector thrives again.
He continued and explained that technology has helped them achieve more of what they expected in the business world.
Mr. Chan said that they would stay focused by using reliable approaches to improve wholesale trade issues, especially after the pandemic affected the sector in a large percentage.
Wholesale trade activities to be best and reliable
Singapore is known to provide the best services and reliable approaches when it comes to wholesale trade activities. This implies that any business person looking forward to engaging in wholesale trade activities can expect a wide range of opportunities that come along the way. The respective authorities are determined to do their best to help wholesale traders. They extend their reliable services to other investors interested in taking part in the economic growth globally.
When an unforeseen event such as a COVID-19 happens, most sectors, especially entrepreneurship, experience adverse heat. Business people were highly affected because the normal business activities had to change.
Government restrictions made it impossible for businesses to thrive. For instance, the social distancing aspect makes it impossible for a company to attain its daily targets. That is why the government of Singapore is at the forefront to help such businesses stand again.
Statistics show that business loan increased by a large percentage because of the pandemic effect. The purpose of the increased loan was to devise technological means that will help the country at large.
Improving the economic situation of Singapore residents
According to Mr. Chan, wholesale trade plays a vital role in improving the economic situation of Singapore residents. That is the reason they are at the forefront to fight on how they can stabilize the business again.
If you intend to invest in Singapore, you are on the right track, considering that their government is willing to stabilize the economy by uplifting wholesale trade activities.
Conclusion on business loan
Tough times affect everyone and the entire country. The previous pandemic was one thing that shook the whole world. No one was ready, and nobody imagined such a happening could affect the business field. Many countries are trying to get their economic activities back to normal. However, it takes some time. Singapore’s government has opted to increase business loan meant for business growth. They understand the impact of great business activities on their country.
