Green finance grant schemes: sustainable bonds, sustainable loans and sustainability reporting

Why these schemes exist

A green bond is not cheaper to issue than an ordinary bond. It costs more, because someone independent has to confirm that it is actually green. That extra cost falls hardest on smaller and first-time issuers, which is exactly the group a developing green finance market needs to attract. These grants remove that friction.

1. Sustainable Bond Grant Scheme (SBGS)

Funds 100 per cent of eligible external review and rating costs on qualifying issuances.

The cap is conditional, and this is commonly misreported:

• S$125,000 per issuance if the issuer complies with any internationally recognised disclosure standard (for example TCFD, ISSB or ESRS)
• S$100,000 if it does not

Qualifying issuer: companies or financial institutions, onshore or offshore. Up to 2 instruments per issuer.

Qualifying issuance - the gates that catch people out:

• Green, social, sustainability, sustainability-linked, sustainability-linked loan or transition bond, issued and listed in Singapore
• A pre-issuance external review or rating showing alignment with internationally recognised principles
• Minimum size S$200 million, or a bond programme of at least S$200 million with an initial issuance of at least S$20 million
• Minimum tenure 1 year
• Included under the SGX Sustainable Fixed Income Initiative and declared a Qualifying Debt Security
• Reviews performed by external reviewers in Singapore
• For sustainability-linked bonds: post-issuance external review or reporting annually for the first 3 years or the bond's tenure, whichever is earlier
• For transition bonds: the issuer must have developed and publicly disclosed an entity-level transition plan, and use of proceeds must align with the transition category of the Singapore-Asia Taxonomy or an equivalent taxonomy

Applications: to [email protected], no later than 3 months after the issue date.

2. Sustainable Loan Grant Scheme (SLGS)

Funds 100 per cent of eligible external review and advisory costs, with the same conditional cap: S$125,000 if the borrower complies with internationally recognised disclosure standards, S$100,000 if not. Maximum 2 instruments per borrower, over a 3-year funding period from loan origination.

Qualifying borrower: a company (including international organisations such as the IFC or the World Bank, but excluding sovereigns) or a financial institution, onshore or offshore.

Qualifying loan: tenure of at least 3 years and size of at least S$20 million. Refinancing of an existing such loan is excluded.

Instruments: green, social, sustainability, sustainability-linked and transition loans.

External review requirements by type:

• Green, social and sustainability use-of-proceeds loans: pre-origination external review showing alignment with internationally recognised green loan principles.
• Transition use-of-proceeds loans: pre-origination, the borrower must have a publicly disclosed entity-level transition plan plus an external review showing both alignment with recognised transition finance guidance (ICMA, CBI, LMA, LSTA and Singapore market-specific standards) and that proceeds align with the Singapore-Asia Taxonomy transition category or an equivalent. Post-origination, annual external review over the 3-year period on both limbs. A review against the ICMA Climate Transition Finance Handbook satisfies both requirements.
• Sustainability-linked loans: pre-origination review against recognised principles, then annual post-origination review verifying attainment of the borrower's sustainability performance targets. MAS has removed the earlier requirement that at least two targets contribute to UN Sustainable Development Goal environmental objectives.

Singapore nexus: more than 50 per cent of gross revenue from the sustainability advisory and assessment services must be attributable to Singapore-based providers.

Note: ESG ratings have been removed as an eligible expense, pending MAS's Industry Code of Conduct for ESG Rating and Data Product Providers. Advisory provided by the arranging bank is also excluded.

Applications: to [email protected], no later than 3 months after the origination date. All external review documents produced under the grant must be shared with MAS.

Funding: MAS set aside S$15 million, announced on 20 April 2023, to enhance and extend both schemes to cover transition instruments until 31 December 2028.

3. Sustainability Reporting Grant (SRG)

Launched by Enterprise Singapore and EDB on 1 November 2024. Co-funds up to 30 per cent of qualifying costs, capped at S$150,000, for a company's first sustainability report incorporating ISSB-based climate disclosures (IFRS S1 and IFRS S2).

Eligibility:

• Singapore-incorporated SGX-listed companies of any size, before they reach their mandatory compliance timeline, or
• Singapore-incorporated companies with annual revenue of at least S$100 million, before their mandatory compliance timeline

Not eligible: companies that have already published an ISSB-based report, have passed their compliance deadline, or started the project before applying.

Qualifying costs: external consultancy fees; external assurance costs; equipment and software; manpower training for permanent or contract employees.

One application per company.

Deadlines by category:

Those deadlines track the ACRA / SGX RegCo phase-in: the grant closes for each tier as that tier's obligation begins, so the subsidy rewards acting early.

Assurance providers must be ACRA-registered audit firms or Singapore Accreditation Council-accredited testing, inspection and certification firms. Claims may be submitted once the first report is published and the assurance statement covering at minimum Scope 1 and Scope 2 emissions has been verified.

Applying: Singapore-incorporated companies with at least 30 per cent local equity apply through Enterprise Singapore's Business Grants Portal; those with less than 30 per cent local equity apply through EDB.

The three scheme pages

• Sustainable Bond Grant Scheme: https://www.mas.gov.sg/schemes-and-initiatives/sustainable-bond-grant-scheme
• Sustainable Loan Grant Scheme: https://www.mas.gov.sg/schemes-and-initiatives/sustainable-loan-grant-scheme
• Sustainability Reporting Grant: https://www.enterprisesg.gov.sg/financial-support/sustainability-reporting-grant