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‘Preferential’ rates for local firms to defray sustainability-related costs under new DBS, Enterprise Singapore scheme

Jovi Ho
Jovi Ho • 4 min read
‘Preferential’ rates for local firms to defray sustainability-related costs under new DBS, Enterprise Singapore scheme
As part of the new ESG Ready Programme, DBS and Enterprise Singapore will also provide foundational training and support to these companies on sustainability matters. Photo: DBS
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Singaporean businesses with annual sales turnover of up to $1 billion can look forward to “preferential” financing rates from DBS to defray costs from developing and adopting sustainable business practices. 

These include green loans, as well as sustainable trade and supply chain finance, says the bank on April 3. DBS representatives decline to reveal the exact rate, but say this will be assessed on a case-by-case basis.

As part of the new ESG Ready Programme, DBS and Enterprise Singapore will also provide foundational training and support to these companies on sustainability matters.

EnterpriseSG will support 70% of the cost of eligible activities per company till March 31, 2026. These include carbon assessment, consultancy, certification and assurance services. 

Under the programme, businesses can choose to participate in either a basic or intermediate level of training, depending on their needs. Companies will also undergo an initial baseline assessment to establish their carbon footprint. 

They will also gain access to a panel of sustainability specialists to guide them on their respective sustainability journeys. These advisers include the Singapore Environmental Council, Deloitte, Schneider Electric, TÜV SÜD, Keppel and ESGpedia by STACS.

See also: Environmental criteria for government tenders, fixed grants to green manufacturing announced

Registration for the first cohort of up to 100 companies is now open and all sectors are welcome. The programme is slated to begin within 2Q2024. 

By the end of the six-month programme, they will have formulated a clear sustainability action plan or have started to implement their decarbonisation strategy, say DBS and Enterprise Singapore.

The ESG Ready programme was launched at DBS’s inaugural Sustainability Day, held at the bank’s headquarters at Marina Bay Financial Centre.

See also: DBS to offer sustainable financing at 'preferential rates' to SMEs in Sheng Siong's supply chain

Some 100 people attended the event, which involved workshops on sustainability transition and a panel discussion featuring leaders from three mid-size corporations — Pan-United Concrete, Barghest Building Performance and Ghim Li — on their sustainability efforts.

Companies that have started on their sustainability journeys “will be in a beneficial position” when sustainable procurement practices become more widespread, says Enterprise Singapore managing director Cindy Khoo.

This trend is gaining momentum, not just in Singapore, but globally, adds Khoo in her keynote speech.

In March 2023, the Singapore government announced plans to incorporate environmental sustainability criteria for government tenders involving large construction and information and communications technology (ICT) projects.

Together, the two sectors make up more than 60% of the value of government procurement contracts awarded, said Minister for Sustainability and the Environment Grace Fu at her ministry’s Committee of Supply debate last year.

DBS will partner participating companies and guide them through their sustainability journey, says Khoo. “This includes building awareness on how to start, having expert help to put together a sustainability plan, and eventually, access to financing solutions from DBS to address the costs of becoming more sustainable.”

Koh Kar Siong, group head of corporate and SME banking at DBS, says the transition to a low-carbon economy can be complex for smaller businesses, due to constraints like a lack of resources, time, expertise and funds. 

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Koh adds: “It is imperative that we provide companies with the necessary support to integrate sustainability into their business operations… The ESG Ready Programme aims to help companies remove the guesswork on how to become sustainable by laying out a comprehensive roadmap with clear steps and relevant solutions, making it easier for them to take action.”

The new programme builds on a similar DBS initiative earlier this year. In February, DBS announced a partnership with Sheng Siong to offer sustainable financing at “preferential rates” to up to 1,000 SMEs in the supermarket chain’s supply chain over the next two years. 

The two Mainboard-listed firms said they will jointly introduce a comprehensive sustainability programme that aims to help businesses become more resource-efficient and reduce their carbon footprint by identifying, developing and implementing decarbonisation plans.

According to DBS and Sheng Siong, the programme will be tailored to meet the specific needs of SMEs in the wholesale trade and retail sector. 

As at 10.25am, shares in DBS are trading 17 cents lower, or 0.47% down, at $36.03.

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