MAS Outlines Measures to Target Accessibility for SMEs Under GSLS
MAS published response to a question asked in the Parliament on measures to target small and medium-size enterprise (SME) awareness and accessibility under the Green and Sustainability-Linked Loan Grant Scheme (GSLS). The response states that the GSLS has a track that encourages banks to develop green and sustainability-linked loan frameworks, which will have to include eligibility criteria that are verified against internationally recognized green and sustainability-linked loan principles. This removes the need for SMEs to develop their own customized frameworks before obtaining a green or sustainability-linked loan, and reduces the friction SMEs face in accessing such loans. HSBC and OCBC have launched such green and sustainability-linked loan frameworks for SMEs.
GSLS aims to support companies of all sizes, including SMEs. MAS will defray up to SGD 100,000 of the expenses incurred by borrowers in engaging independent service providers to verify the green and sustainability credentials of such loans. While the GSLS supports the adoption of such loans, MAS recognizes that the cost, time, and effort of procuring the necessary sustainability advisory and assessment services may not be commensurate with the loan quantum, particularly for smaller SMEs. The GSLS, therefore, has the track that encourages banks to develop green and sustainability-linked loan frameworks. Under this track, MAS provides greater funding support to banks when they develop loan frameworks that are targeted at SMEs. Expenses incurred by banks to develop, verify, and report on the green and sustainability credentials of loan frameworks targeted at SMEs will be defrayed by 90%, compared with 60% of expenses for other green and sustainability-linked loan frameworks. MAS expects to support more banks in developing such frameworks under the GSLS. To promote awareness and encourage take-up of the GSLS, MAS is partnering with Enterprise Singapore (ESG) and banks to reach out to SMEs.
Keywords: Asia Pacific, Singapore, Banking, GSLS, Sustainable Finance, ESG, SME, Credit Risk, MAS
Previous Article
ESMA Withdraws Licenses of UK-Based CRAs and Trade RepositoriesRelated Articles
EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models
The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.
EP Reaches Agreement on Corporate Sustainability Reporting Directive
The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).
PRA Consults on Model Risk Management Principles for Banks
The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.
EC Regulation Amends Standards for Calculating Credit Risk Adjustments
The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.
HKMA Announces Launch of Data Repository on Sustainable Finance
The Hong Kong Monetary Authority (HKMA) announced that the Green and Sustainable Finance (GSF) Cross-Agency Steering Group has launched the information and data repositories and outlined the progress made in advancing the development of green and sustainable finance in Hong Kong.
BIS Hub Updates Work Program for 2022, Announces New Projects
The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.
EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance
The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.
NGFS Report on Integration of G-Cubed Model into NGFS Scenarios
The Network for Greening the Financial System (NGFS) published a report that explores the feasibility of integrating the G-Cubed general equilibrium model into the NGFS suite of models.
US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule
Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)
EIOPA Consults on Review of Securitization Framework in Solvency II
The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.
