Financial Relief For Businesses In Hong Kong
Small and Medium Enterprises would now enjoy more financial relief with the new SME Financing Guarantee Scheme. Introduced by the Mortgage Corporation Insurance Limited, the 80% Guarantee Product of the SME Financing Guarantee Scheme provides immediate support to Small and Medium Enterprises (SMEs).
SME Business Owners Can Now Apply for Principal Moratoriums
SME borrowers may apply to their lenders under the guarantee scheme for principal moratorium of up to six months which is renewable, subject to a maximum of 12 months in total. During the period, only interest payments have to be made.
Seven Years Maximum Guarantee Period
Accordingly, the guarantee period can be extended, but should not exceed the maximum guarantee period of seven years, with guarantee fee payable to cover the extension of the guarantee period.
This new measure is applicable to existing and new borrowers under the SME Financing Guarantee Scheme.
Experts explain that the new scheme is designed to reduce the pressure on the cash flow of SMEs.
It is hoped that lenders can make use of the new measure to assist SMEs who are facing difficult situations.
Consolidation of SME Centres to Provide Integrated Service
Meanwhile, the Government will consolidate the services of existing SME centres under the following:
- Trade Development Council
- Trade and Industry Department
- The Productivity Council
- The Science & Technology Parks Corporation
Consolidation of the services of the four centres will help provide an integrated service for SMEs. From 1 October, SMEs can obtain the required information of all funding schemes at any service point.
In order to promote these funding schemes, the Government will establish a team to reach out to SMEs. The Government will also streamline the application procedures for various funding schemes to better meet the needs of SMEs.