Note: This article was first published on July 2020. It has since been updated to reflect the latest available information as of March 2023.
If you’re planning to digitally transform your business, you’ll need to start by digitising and digitalising your business processes by implementing a software solution for the first time.
To fund your first-time effort at digital transformation, you’d have been looking into applying for government grants that will help pay for the software you need.
And one of the first grants you’ve come across is undoubtedly going to be the Productivity Solutions Grant (PSG).
Designed specifically to encourage businesses like yours to adopt IT solutions and equipment, the PSG will provide the financial support you need to implement the software that will help you manage your business processes more effectively.
But as a first-time applicant for a government grant, you’ll likely have many questions about applying for the PSG in the first place.
To answer your questions and boost your confidence in the process of applying for the PSG, we’ve put together a list of 13 frequently asked questions (FAQs) about the PSG application process for your reference.
1. How Do I Apply For The PSG?
It’s actually quite straightforward. Here’s how you can apply for the PSG:
- Visit the GoBusiness Gov Assist page to find the list of supportable solutions for the PSG, and identify the solution that would best suit the needs of your business.
- Obtain a quotation from the pre-approved vendor of the supportable solution of your choice.
- Make sure that you have not signed any contract or made any payments to the vendor of your choice prior to submitting your PSG application.
- Make your submission on the Business Grants Portal (BGP) with your CorpPass account. Here’s a step-by-step guide from Enterprise Singapore (ESG)
2. Is My Business Eligible For The PSG?
Your business is eligible for the PSG if it meets the following criteria.
- Is registered and operating in Singapore
- Has a minimum of 30% local shareholding
- Less than S$100 million annual sales turnover, OR employs less than 200 employees (for selected solutions only)
- Purchase, lease, or subscription of the IT solution or equipment must be used in Singapore.
3. What Documents Do I Need To Apply For The PSG Successfully?
You’ll need the following supporting documents to complete your PSG application:
- A Purchase Order, or a signed quotation/contract
- An invoice
- A bank statement which indicates that your business has made payment to the pre-approved vendor
- The license number(s) of IT solutions, along with a minimum 1 month usage report
- Any screenshots which displays your business’s name, along with the name of the IT solution.
- A copy of a cheque payment or a receipt for the IT solution.
4. Can Quotations From Pre-approved Vendors Be Modified To Include Additional Items Or Services?
Unfortunately, no. Your quotation may not differ from the IT solution package that was submitted for your PSG application. If it does, the quotation will be rejected.
Any additional items you wish to implement with your IT solution must be quoted separately, and any modifications you make to your IT solution package must be submitted again to the Infocomm Media Development Authority (IMDA) for approval.
5. Can PSG Pre-approved Vendors Like AFON IT Submit An Application On My Behalf?
What Types Of Solutions Does The PSG Cover?
The PSG covers IT solutions that provides sector-specific functionalities. These sectors are as follows:
- Precision Engineering
On top of sector-specific solutions, the PSG will also cover solutions which offer features for managing business functions that cut across multiple sectors. These include:
- Customer Management
- Data Analytics
- Financial Management
- Inventory Tracking
Note: Due to the economic impact of the COVID-19 pandemic, the PSG now also supports IT solutions which helps your business implement business continuity measures. This means you can also apply for PSG support for the following types of solutions:
- Online Collaboration Tools
- Virtual Meeting and Telephony Tools
- Queue Management Systems
- Temperature Screening Solutions
7. How Much Of Your Costs Will The PSG Cover?
Upon a successful application, up to 70% of the total costs you’ve incurred to acquire your pre-approved IT solution will be covered by the PSG. If your business is in the Food Services or Retail sectors, you can get enhanced funding support of up to 80% for eligible pre-scoped solutions. This is applicable from 1 April 2022 to 31 March 2023.
From 1 April 2023 onwards, the PSG will cover up to 50% of your total costs.
Unless otherwise stated, this only applies to the actual purchase cost of your chosen IT solution. Other related fees and charges (e.g. delivery fees, installation) will not be covered by the PSG.
8. Can I Apply For More Than One Solution Under The PSG?
Yes, you can. However, you may not submit applications for IT solutions that will be deployed at the same location.
On the other hand, if your business operates out of more than one location, you may submit applications for one IT solution for each location.
Your business will also be subjected to an annual grant cap of S$30,000 for pre-approved solutions supported by ESG. The validity period of the annual grant cap starts on 1 April, and ends on 31 March of the following year.
9. What Happens If I Use Up My Annual Grant Cap?
In this case, your business will no longer be eligible for further support from the PSG for the remainder of the validity period. The annual grant cap will be refreshed after 31 March, after which you may submit new applications for new IT solutions during the next validity period.
Therefore, you should consider your options carefully, and be certain about your choice of IT solution before you submit an application for PSG funding for said solution.
10. When Should I Submit Claims For Pre-approved Solutions Under The PSG?
When submitting a claim for expenses incurred in acquiring the pre-approved IT solution of your choice, you need to ensure the following:
- You’ve purchased, leased, or subscribed to the solution as was approved in your PSG application.
- You’ve used the solution
- You’ve paid for the solution in full
- You’ve submitted all claim documentation
Claims should also be submitted before the 13th month after your acquisition of your IT solution has been approved, and before the 7th month after your purchase, lease, or subscriptions has been approved.
11. Can I Submit Any Claims For My IT Solution Before The Application Date?
Unfortunately, no. You can only claim any IT solutions under the PSG after the application date.
Your application must be submitted before the invoice, quotation or engagement letter with the solution provider has been signed, payment to the solution provider has been made, and the implementation project has commenced.
12. How Long Will My Claims Take To Be Processed?
Your claim will typically take anywhere from four to six weeks from the date that you submitted all of the required information.
Therefore, we suggest that you submit your claims after your IT solution has been fully deployed, and provide all the necessary documents to show that you’ve been using the solution for at least one month. Any incomplete submissions will lead to delays in the disbursement of your claim.
13. How Will My Grant Be Disbursed To Me?
Your grant will be credited directly to your business’s bank account through GIRO. Before your grant can be disbursed, your completed GIRO form must first be verified by your business’s bank, and then submitted to ESG before your business’s claim request.
If you’ve made multiple claims, the GIRO form will only be required when you submit your first claim.
If you’ve made any changes to your business’s bank account details, you’ll need to submit a new GIRO form.
Funding The First Steps To Digitalising Your Business With PSG
We hope that this FAQ to the PSG have answered any burning questions you might have about the PSG, and showed you everything you need to know about the application process.
By the way, if you’re thinking about implementing SAP Business One or Microsoft Dynamics 365 Business Central in your business, did you know that AFON IT is a pre-approved vendor for both ERP software under the PSG?
If you’ll like to schedule a consultation and/or get a quotation from us for your PSG application, feel free to drop us a note here.
Otherwise, if you’re still not sure whether the PSG is right for you, would you like to know if there are any other government grants that would suit your funding needs better?
If so, you’re in luck; we’ve already got a guide to all the government grants in Singapore that can help fund the digital transformation of your business. Just click the image below to view the guide that’ll show you what you need to know!