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The Ultimate Guide to Hong Kong Government Funding Resources and Support for SMEs – 2020

By FastLane Team, May 21, 2020 ()

The Hong Kong Government has repeatedly acknowledged and expressed their commitment to supporting SMEs in Hong Kong. In recent weeks, a lot of attention has been put on the financial support that SMEs are available to SMEs. In this article, we have provided a list of the various Hong Kong government’s financing schemes that we find are applicable towards SMEs.

 

What You Will Learn In This Article

1. Dedicated Fund on Branding Upgrading and Domestic Sales (“BUD”)
2. SME Export Marketing Fund
3. SME Financing Guarantee Scheme (“SFGS”)
4. SME Loan Guarantee Scheme
5. Trade and Industrial Organisation Support Fund (“TSF”)
6. Microfinance Scheme
7. Distance Business Programme (“D-Biz”)

1. Dedicated Fund on Branding Upgrading and Domestic Sales (“BUD”)

The BUD fund is designed to provide funding support to individual Hong Kong enterprises in undertaking projects to develop brands, upgrade and restructure their business operations and promote sales in the ASEAN market and Mainland China market, so as to enhance their competitiveness and facilitate their business development in the ASEAN and Mainland China market.

 

Maximum Funding Amount

 

  • HKD 1,000,000

 

Financing Type

 

  • Subsidy

2. SME Export Marketing Fund

The SME Export Marketing Fund aims to provide financial assistance to SMEs who are looking to expand their business by encouraging their participation in export promotion activities. Recently, this scheme has also been expanded to include SMEs participation in virtual exhibitions. However, all export and promotion activities/platforms that are under this funding scope must be organised and operated by groups with a good track record.

 

Potential applicants may consult with the Hong Kong Trade and Industry Department for advice on whether a particular export or promotion activity is covered under the scope of the SME Export Marketing Fund.

Maximum Funding Amount

 

  • HKD 100,000

 

Financing Type

 

  • Subsidy

3. SME Financing Guarantee Scheme (“SFGS”) 

SFGS was started by the Hong Kong Mortgage Corporation Limited with the intention of helping SMEs and non-listed companies to obtain financing from Hong Kong’s various lenders by acting as the guarantor for potential loans. 

 

The SMEs and non-listed companies who are approved under this scheme must use the assistance to better meet their business needs for the purposes of increasing their company’s productivity and competitiveness. 

 

Maximum Funding Amount

 

There is no maximum funding amount under this scheme. However, applicants will be subject to heavy approval and vetting and must be able to provide evidence to substantiate the use of the loan.

 

Financing Type

 

  • Loan guarantee

4. SME Loan Guarantee Scheme 

Under the SME Loan Guarantee Scheme, the Hong Kong government will act as the guarantor for individual SMEs to facilitate the obtainment of loans from participating lending institutions. The difference between this scheme and SFGS is that loans obtained under the SME Loan Guarantee Scheme must be used for the acquisition of business installations and equipment, or for meeting working capital needs of a company’s everyday operations. 

 

The installation and equipment purchased may be located outside of Hong Kong and may also be used for acquiring second-hand installations and equipment. The loan is primarily used for:

 

  • Machinery
  • Tools
  • Computer software and hardware
  • Communication systems
  • Office equipments
  • Transport facilities
  • Furniture
  • Fixtures

 

Maximum Funding Amount

 

  • HKD 6,000,000

 

Financing Type

 

As financing is structured as a loan guarantee, the loans obtained must be structured as the following:

 

  • Business Installations and Equipment loans must be in the form of either a non-revolving loan or a hire purchase agreement
  • Working capital loans must be in the form of a non-revolving loan

5. Trade and Industrial Organisation Support Fund (“TSF”)

TSF provides financial support to non-profit-distributing organisations to implement projects which aim at enhancing the competitiveness of non-listed Hong Kong enterprises in general or in specific sectors.

 

Funding scope extends to all projects (except activities which are or will be in receipt of other Government funding support) that will enhance the competitiveness of non-listed Hong Kong enterprises.

 

Maximum Funding Amount

 

  • HKD 5,000,000

 

Financing Type

 

  • Grant

6. Microfinance Scheme

This scheme is a collaboration between the Hong Kong Government, several Hong Kong banks and various non-government organisations. The aim is to provide assistance to assist people who wish to start a business, become self-employed or achieve self-enhancement through training, upgrading of skills or obtaining professional certification. 

 

Maximum Funding Amount:

 

  • HKD 300,000

 

Funding Type

 

  • Loan

7. Distance Business Programme (“D-Biz”)

The Innovation and Technology Commission has launched this initiative as a response to the new trend of remote working during COVID-19. This initiative aims to support and encourage companies to embrace a remote working business model. 

 

D-Biz will not only cover the relevant training expenses for employees in their transition to remote working, but will also help fund the adoption of various IT solutions, such as the adoption of digital payments, cloud-based financial management systems and virtual team management and communication tools. 

 

Maximum Funding Amount:

 

  • HKD 300,000

 

Funding Type

 

  • Subsidy

Conclusion

Financing is always a topic of interest for SMEs and we at FastLane support the Hong Kong Government’s dedication to helping Hong Kong businesses in this aspect. As there are many more financing schemes available, please stay tuned for further insights!

FastLane has extensive experience assisting SMEs. Whether you require accounting, audit, company secretarial or HR assistance, please contact us for a quote!



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