Loan Insurance Scheme (LIS) provides an avenue for Singapore companies to obtain trade financing through the use of loan insurance. It is a joint programme between SPRING Singapore and IE Singapore and part of the insurance premium will be sponsored by the Government.

Loan Insurance Scheme Plus (LIS+) was implemented by the Singapore government in February 2009 as a complementary programme to LIS. It aims to avail larger tranches of trade financing lines to more businesses.

Benefits

• Wide range of loan facilities may be considered under LIS/LIS+ including
  • Inventory/stock financing loans
  • Structured pre-delivery working capital facilities (including revolving working capital facilities related to underlying trade transactions)
  • Factoring/Bill or Invoice or accounts receivable discounting with recourse
  • Overseas Working Capital Loans Support Facilities (Borrower of the LIS4 Loan is a majority-owned overseas subsidiary of a Singapore-based company)
• Banker’s Guarantee in support of contract fulfillment
• Financing may be used for a broad range of business activities, including to
  • Support establishment of inventory storage and distribution hub
  • Expand existing manufacturing capacity
  • Diversify into other product lines and capabilities
  • Augment working capital needs
  • Expand trading into new markets
  • Broaden distribution channels
  • Support and fund their majority-owned overseas subsidiaries

Who can apply

For domestic facilities

You can apply for LIS/LIS+ if your company meets the following criteria:

• At least 30% of your company’s shareholding is local AND
• Company’s Group* annual sales of not more than S$100m OR Group* employment size of not exceeding 200 workers

For export-oriented facilities

You can apply for LIS/LIS+ if your company meets the following criteria

• Companies registered with Accounting & Corporate Regulatory Authority of Singapore with at least 3 strategic business functions in Singapore. Strategic business functions refer to activities such as banking and finance; marketing and business planning; procurement/logistics; training and personnel management; investment planning/coordination; research and development; technical support and manufacturing
• Group Turnover Cap
  • Non-Trading companies:  =< S$300m
  • Trading companies: =<S$500m

(Company is considered a trading company if more than 50% of turnover comes from buying and selling goods.)

Companies applying for both domestic and export facilities must meet both sets of criteria stated above.

Insurance premium

LIS

With effect 1 Jan 2012, insurance premium imposed on loan facilities covered under LIS will be as follows:

• 1.75% p.a. at primary level
• 2.00% p.a. at auto top-up level
• 2.80% p.a. at discretionary top-up level

Spring Singapore/IE Singapore will provide financial assistance to cover 50% of the insurance premium. The remaining insurance premium and GST is to be paid by the applicant when the loan is approved.

Please note that the government subsidy for the loan insurance premium for Overseas Working Capital Loans Support Facilities will be pro-rated by the Singapore-based company’s share in the overseas subsidiary.

LIS+

An insurance premium of 1.5% p.a. and GST will be imposed on loan facilities covered under LIS+. The premium is to be paid by the applicant when the loan is approved.

To apply, simply complete and fax all of the following to 6345 9091

• Loan Insurance Scheme Application Form (Company)
• Commercial Loan Application Form (Company) (PDF)
• Supplement Form for Overseas Working Capital Loans Via Standby Letter of Credit

We will be in touch with you shortly.

For more information, call 6645 3613 / 6645 3631 / 6293 9097.