PwC’s design of a central lending platform concept for Singapore: Acceleration and Digitization for struggling SMEs

A pandemic-induced national problem with a PwC-designed solution.

In late August, PwC announced an initiative that can complement the Singapore government’s efforts to facilitate bank loans to small and midsize enterprises (SMEs). Given the confluence of technology, consulting and PwC’s continually evolving business model, TBR requested a discussion with the firm’s leaders working on this initiative.

TBR states that: “In response to the COVID-19 pandemic and subsequent economic fallout, Singapore’s government sought to bolster the SME market, which employs 70% of the city-state’s workforce and generates 50% of its gross domestic product (GDP), in part through a risk-sharing program for loans to eligible SMEs. Early efforts attracted only 2% of the SMEs to apply for loans, which PwC attributed in part to lengthy loan application and approval processes exacerbated by the COVID19 lockdown. The gap due to surge in demand and reduced supply provided an opportunity for PwC to design a Central Lending Platform to simplify the loan process, quickly connect SMEs to multiple banks in one single platform, facilitate faster access to capital, and provide Singapore’s government with analytics and data surrounding the SME sector and associated market share, including delivering insight into industry competitiveness to guide quicker and more meaningful policy decisions.”

The report mentions that “PwC’s design of a Central Lending Platform provides a number of essential benefits for SMEs, Singapore banks and Singapore’s government, including the minimization of human efforts and errors in loan applications and processing; always-on, always available services; and the collection and assembly of previously uncollected data in a single, digital place. According to PwC, banks prepared to loan to SMEs will rely on the platform for an “immediate eligibility assessment” of whether an SME meets the criteria developed by Singapore’s government. The digital platform will eliminate the need for banks’ loan relationship managers to check the completeness of documents, a process that PwC noted contributed to a 6- to 10-week waiting time from application submission to access to capital.”

TBR also states that: “As an added benefit to Singapore’s banks, PwC noted that credit decisioning around SMEs is changing in Singapore and speculated that the new Central Lending Platform, after serving its pandemic-based role of facilitating government-backed loans, will help the banks move beyond traditional views of SMEs.”

It goes on to say: “This Central Lending Platform, which may be replicable with other Asian governments and SME ecosystems, exemplifies the transition of PwC from a traditional consulting firm to the business-experience technology consultancy … PwC’s ability to pull together industry expertise, long-standing relationships with public and private sector players, and technology partners makes a compelling business case.”

According to Irene Liu, Government & Public Services Co-Lead, Southeast Asia Risk & Regulatory Consulting Lead, "At the heart of the design principles of the Central Lending platform is a win-win solution for both SMEs and banks - SMEs benefit from the speed and fuss-free access to all participating banks whilst banks have immediate access to more customers and can embark on digitalisation without huge infrastructure outlay."

Contact us