DBS sets aside S$500,000 in grants for social enterprises

Singapore

TO HELP social enterprises protect jobs and ease cashflow pressures, DBS will offer low-interest, collateral-free working capital funding to the Singapore Centre for Social Enterprise's network of 360 social enterprises.

Dubbed the SE Digital Business Loan, these loans will be offered at rates as low as 2 per cent per annum, and gives each applicant up to S$200,000 of funding. The funds can be disbursed as quickly as five days after they sign and accept their letters of offer.

The loans comes bundled with complimentary loan replacement insurance. Loan processing fees usually pegged at S$500 or 2 per cent of the approved amount will also be waived, DBS said.

Boxgreen, which specialises in producing healthy snacks, recently secured a working capital from DBS. Co-founder Walter Oh, whose staff of 30 includes seniors and ex-offenders, said his company has suffered up to a 50 per cent dip in some revenue streams.

The loan from DBS provided much-needed cashflow to retain jobs and keep the business running, said Mr Oh. "Social enterprises continue to be mindful of the impact they are creating, and keeping jobs is one of the biggest social contributions and impact at the moment," he said.

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He appreciated the timeliness of the loan disbursement. Boxgreen received the loan within less than a month from application.

DBS has set aside S$500,000 in grants for 60 enterprises supported by the DBS Foundation across Asia.

In the last few weeks, 13 Singapore-based social enterprises across various industries have applied for the grant, known as the DBS Foundation Business Transformation and Improvement Grant. Collectively, these groups employ 2,500 people and support over 100,000 beneficiaries.

DBS said that the enterprises applied for the grant primarily to fund solutions that enhance caregiving and medical services to the elderly and other segments vulnerable to Covid-19, as well as to provide employment for the disadvantaged and marginalised.

Joyce Tee, DBS group head of SME Banking said the financial needs of social enterprises (SEs) are often overlooked by lenders as they usually do not have a borrowing history with banks or the relevant credit profiles.

Amid the ongoing recession, access to working capital to keep their business afloat may be even more difficult.

"To fulfil their social and business mission, social enterprises are working harder than ever during this period to protect jobs and do their part for society . . . It is necessary for us to stand by these SEs by providing them with timely and affordable access not just to funding but also to the bank's expertise in business and digital transformation," Ms Tee said.

Wateroam, which develops water filters for rural communities and disaster-hit areas outside Singapore, is one of the 13 enterprises that applied for the grant. If approved, it plans to use the funds to build a "virtual experience centre" to help prospective clients better understand its work, said chief executive officer David Pong.

"Our work depends a lot on going down to different villages and talking to the communities. Many of these things are stalled now due to the lockdown. We can't build relationships nor deploy our products," said Mr Pong.

"We have been trying to tackle this by digitalising our marketing. We hope the grant can help us build a virtual experience centre, so customers can go on a virtual journey as they would have in a trade show."