QUESTION NO 3624

NOTICE PAPER 1450 OF 2022

FOR ORAL ANSWER

Date: For Parliament Sitting on 20 October 2022

Name and Constituency of Member of Parliament

Mr Desmond Choo, MP, Tampines GRC

Question:

To ask the Prime Minister in view of higher interest rates (a) whether there has been an increase in corporate bad debts; and (b) how does the Monetary Authority of Singapore ensure that SMEs continue to have access to capital to grow their businesses.

Answer by Mr Alvin Tan, Minister of State, Ministry of Trade and Industry and Ministry of Culture, Community and Youth, and Board member of MAS, on behalf of Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS:

1. The corporate sector has thus far managed the rise in interest rates well. Corporate revenue has continued to grow. The proportion of non-performing loans (NPL) for the corporate sector has in fact fallen over the past year – from 3.1% in June 2021 to 2.5% in June 2022, based on latest available data. The NPL ratio within the SME segment also fell from 2.8% to 2.4% over the same period.   

2. SME loan volumes have indeed remained resilient over the past year, even as interest rates gradually rose. SME loan volumes expanded by 11.5% on a year-on-year basis in August 2022, compared to the broader corporate loan growth of 7.2%.
   
3. As SMS Chee Hong Tat recently explained to this House on 4 Oct 2022, the Government assists businesses to access capital to grow their businesses through various credit schemes. We will continue to monitor developments in this space.

***