A global pandemic caused by the COVID-19 virus has taken Singapore by storm. It has devastated many Singapore SMEs to the point where unemployment grew and businesses went bankrupt. An SME loan Singapore can help SMEs to rely upon for survival during the COVID-19 economic downturn. But just how can the SMEs pull through the difficult times? We bring you the survival guide of SMEs in the wake of the COVID-19 pandemic.
The Singapore Government has come up with initiatives to help the SME businesses tide over the difficulties. One of the initiatives is the $11 billion Resilience Package to save businesses from near solvency and to save people from being retrenched. This is to fulfil their pledge for the support of SMEs to survive the COVID-19 as the SMEs contribute the most to the economy and are vulnerable to such economic troubles.
However, SMEs can prepare themselves for survival on their own by doing the important tasks, one of which is to have a Business Continuity Plan (BCP). This continuity project can make sure that the businesses continue to function as normal and effective should a disaster strike. A major method of the BCP is to allow the employees to work from home so as to prevent the viruses from pervading the workplace as the COVID-19 infection can lead to permanent damage of organs or even death.
Another measure undertaken by the SMEs is cost cutting. It is an important survival guide plan but it does not mean cutting the workforce initially. It meant that travel expenses be cut so that air travel can be reduced if some are found to be unnecessary. Also, there should be a reduction of any software or materials to save costs for the companies during the COVID-19. As more work arrangements have been made, SMEs should explore ways to utilise in order to save costs.
The SME loans given to the SMEs can help to obtain immediate financial relief. Since the outbreak of the virus began, many banks like DBS and UOB have been disbursing the SME loans to much needed SMEs. With the help of the SME loan during the COVID-19, SMEs have applied for bridging loans and restructured their loans. Short term cash flow issues become properly managed.
Banks however may not be the best financial institutions to get SME loans. An alternative to banks is the licensed moneylender. The SME loans from licensed moneylender provide immediate cash relief by getting the approval processes done faster and more conveniently.
All in all, an SME loan is useful in helping the small businesses settling upfront payment of salaries of workers, inventory or materials needed because they are required before cashflow is received. And even they are used before a business deal is finalised. Sales proceeds for SMEs tend to be late and only come in in a few months' time. Especially during a COVID-19 difficult period.
More about government help for SMEs during the COVID-19 downturn can be found - www.businesstimes.com.sg/sme/singapore-budget-2021/financial-support-tops-budget-2021-wishlist-for-smes-in-singapore-uob
