The Government announced that the application period for the Special Loan Guarantee Scheme (“SpGS”) would be extended for another six months to June 30, 2010. The Government’s total loan guarantee commitment under “SpGS” will remain at $100 billion.
So far, 46 participating lending institutions (“PLIs”) have joined the “SpGS”. As of October 27, the Trade and Industry Department has approved 22,341 applications, involving a total loan amount of $53.5 billion. The applications approved cover a wide spectrum of companies and industries in both manufacturing and non-manufacturing sectors. The companies concerned have more than 250,000 employees and about 95% of the beneficiaries are Small Medium Enterprises (“SMEs”).
The “SpGS” was introduced on December 15, 2008. It is a time-limited initiative to tackle the credit crunch problem arising from the global financial crisis.
Under the “SpGS”, the Government provides a total loan guarantee commitment of $100 billion. With effect from June 15, 2009, the Government increased its guarantee ratio for loans granted by the PLIs from 70% to 80%. The maximum loan amount for each enterprise is $12 million, out of which up to $6 million can be used as a revolving credit line.
All registered companies with substantive business in Hong Kong (except listed companies), and have been in operation for more than one year as at December 15, 2008 are eligible to apply.