Small and medium-sized enterprises are considered as the key pillar of Singapore’s economy, contributing to almost half of the country’s Gross Domestic Product (GDP) and employing two-thirds of its total workforce. Centered on electronics, trade, finance and business services, the Singapore economy plays a fundamental role in the livelihoods of many locals. With various sectors gradually embracing digital transformation, the Singapore government has introduced a list of grants to help SMEs reach success by making the most out of digital technologies.
COVID-19 Pandemic and its Effect on SMEs Digital Transformation
According to research, 83% of all SMEs in Singapore are prepared with digital transformation strategies in place. However, 54% reported delays on their digitalisation plans due to the COVID-19.
Given the economic uncertainties brought about by the pandemic, many SMEs in Singapore have faced challenges that greatly affect their digital transformation plans. Cost and lack of digital skills, among others, are the major barriers according to most companies. 56% said it was too expensive to digitalise.
Government Grants for SMEs Digitalisation in Singapore
Since the year 2010, the Singapore Government has been vocal in its advocacy to help businesses especially SMEs in the country to undertake digital transformation.
In today’s world of uncertainties amid the global pandemic, running a business can be extremely challenging, not to mention, terrifying. More and more businesses are becoming less excited to spend their money on new investments, others even opt to take cost-cutting measures to keep their companies afloat.
With the increasing rate of unemployment and business closure, SMEs in Singapore will surely need all the help they can get. Fortunately, the Singapore government offers a wide range of grants to help local businesses as they strive to survive these trying times.
Productivity Solutions Grant
Productivity Solution Grant or simply PSG is an Infocomm Media Development Authority (IMDA) that aims to help SMEs as they adopt digital solutions to improve productivity and enhance business processes. It covers sector-specific solutions such as the retail, food, logistics, precision engineering, construction and landscaping industries.
With PSG, SMEs can receive up to 80% of funding support for approved equipment and solutions from 1 April 2020 to 31 March 2022
E-Invoicing Registration Grant
The E-Invoicing Registration Grant is an initiative administered by the IMDA in partnership with Enterprise Singapore to help businesses join the nationwide E-invoicing network on or before 31 December 2020. It is a one-time $200 grant that aims to help SMEs reduce the cost of digitalisation. The E-Invoicing Registration Grant will be used to offset the incremental cost that comes with adopting Peppol-ready accounting/ERP solutions.
SMEs Go Digital Programme
The SMEs Go Digital programme is designed to encourage SMEs to use digital technologies and help them as they create stronger digital capabilities.
Launched in January 2019, Start Digital aims to guide newly-incorporated SMEs to run their business right by introducing easy-to-deploy digital solutions. With the existence of the COVID-19 pandemic, the Start Digital Pack has been enhanced and has since included digital collaboration tools necessary for remote working. What’s more, it now has digital marketing through social media and integrated digital utilities such as e-invoicing and e-payment.
The Start Digital currently includes Accounting, Human Resource Management System & Payroll, Digital Marketing, Digital Transactions and Cybersecurity solutions. With the new and enhanced version, it will now include three essential categories: Digital Collaboration, Digital Marketing and Digital Transactions.
The Start Digital Packs are offered by six IMDA partners DBS, M1, Maybank, OCBC, Singtel and UOB.
Under the Grow Digital initiative, SMEs are allowed to participate in any Business-to-Business (B2B) and Business-to-Consumer (B2C) eCommerce platforms, authorising them to sell overseas without the need for their physical presence. The Grow Digital is best for businesses who are willing to enter opportunities on the global market.
Through Grow Digital, SMEs can:
- Connect suppliers with overseas clients
- Optimise listings on eCommerce marketplaces
- Access financing offers
- Cross-border e-payment facilities
- Access with strong partners network such as logistics companies for last-mile delivery
- Benefit from training and support for cross-border eCommerce
Advanced Digital Solutions
As announced in the Resilience Budget 2020, 80% funding support will be given to SMEs for the Advanced Digital Solutions (ADS). This initiative is designed to help companies deepen their digital capabilities, develop stronger business continuity measures and build long-term resilience.
The funding support for the ADS can be used to cover the costs of hardware, software, infrastructure, connectivity, cybersecurity, integration, development, enhancement and project management. Furthermore, the programme will cover the cost involved in deploying these solutions. This includes acquisition, subscription, lease and training.