Loan Insurance Scheme (LIS)

Overview

About

Companies can secure short-term trade financing with the Loan Insurance Scheme (LIS), which insures the banks against insolvency risks of the borrowers. Loans are underwritten by commercial insurers, while a portion of the insurance premium is supported by the Government.

Companies can apply for the LIS to secure short-term trade financing lines such as:

• Inventory / stock financing facility
• Structured pre-delivery working capital
• Factoring / bill or invoice or accounts receivable discounting with recourse

Eligibility

Companies applying for the LIS should meet the following criteria:

• Registered and operating in Singapore
• At least 30% local shareholding
• Applicant’s group annual sales turnover should be up to S$100 million or applicant’s group employment size must not exceed 200 workers¹

Apply

1. Ensure your business qualifies for the loan
2. Consult any of the Participating Financial Institutions (PFIs) for advice and assistance
3. Meet the financial institution with these supporting documents:
   • Business profile from ACRA
   • Audited accounts or certified financial statements
   • Bank statements
   • Personal income tax assessment of owners and directors
   • Other documents as required by your banker or financial institution

Applications can be made through any of the PFIs listed below:

c. Post-application

• Pay the insurance premium upon successful application
• Receive notification from the financial institution that the loan is ready for use
• Keep proper records of repayments
• Make repayments on time

¹: Group is defined to include the Applicant, the Applicant’s corporate shareholders who own > 50% of total shareholding and the Applicant’s subsidiaries where the Applicant holds > 50% of the total shareholding of the subsidiaries.

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