OCBC, Maybank offer new solutions to small businesses


EVEN as small and medium-sized enterprises (SMEs) continue their uphill climb in today's rough business conditions, banks are clamouring to tap this segment with more product offerings to meet their needs.

OCBC Bank has launched a new current account targeted at new businesses, with the lowest initial deposit of S$500, and a minimum average monthly account balance of S$3,000.

The OCBC Business Growth Account's fall-below fee is also waived for the first six months, with an annual fee of S$38.

The account was introduced based on a survey conducted by OCBC in September this year. Most business owners indicated that the amount required to open an account should be below S$1,000, while more than 80 per cent of business owners said that S$3,000 was the minimum monthly amount they will maintain in their banking account for making payments.

Said Eric Ong, head of emerging business, global commercial banking, OCBC Bank: "For most start-ups, cash flow is always an issue and to set aside S$1,000 for an initial deposit may be tough for some of them... This will be useful for start-ups as their cash will not be locked up in their account to meet the minimum monthly balance required. Instead, they can use the funds for their day-to-day operations."

Maybank is another financial institution offering solutions for SMEs, this time in the area of financing.

Launched in March this year, its banking product BizMortgage Plus offers financing of up to 120 per cent of the value of their completed, owner-occupied commercial and industrial property (CIP) in Singapore.

According to Maybank, it has seen "increasing interest" by SMEs since it started.

To qualify, companies need to be locally incorporated, established for at least two years and with a turnover of up to S$20 million, among other terms and conditions.

Companies can choose to take up a bundled deal comprising a CIP loan and working capital financing options such as a term loan, an overdraft, trade facilities or business credit card, or any combination of the above.

For example, a company which has just purchased a new office unit can choose to take up a CIP loan of 80 per cent of the property's value, and the remaining 40 per cent can be in the form of a term loan.

Choong Wai Hong, head, community financial services, Maybank Singapore, said: "This product's holistic bundle of offerings addresses the diverse short to long term cash flow needs of SMEs, and can be a viable solution to help ease the financial burden on business owners."

He added that Maybank anticipates BizMortgage Plus to contribute around one-third of their total business property financing in 2017.