SME Financing Guarantee Scheme (SFGS)
80% & 90% Credit Guarantee Application Playbook
HKMCI government-backed credit guarantees · Up to HK$ 18M loan facility · Lowest prime lending rates · Dedicated liquidity for cross-border exporters and Alibaba.com global sellers.
1. What is the SME Financing Guarantee Scheme (SFGS)?
The SME Financing Guarantee Scheme (SFGS) is an institutional credit support program launched by the Hong Kong SAR Government and administered by HKMC Insurance Limited. Under this scheme, the Government provides loan guarantees to participating commercial banks, significantly lowering credit risk and enabling SMEs to obtain low-interest working capital loans without requiring heavy real estate collateral.
2. Comparison: 80% Guarantee vs. 90% Guarantee Products
| Core Feature | 80% Guarantee Product | 90% Guarantee Product |
|---|---|---|
| Maximum Facility | Up to HK$ 18,000,000 | Up to HK$ 8,000,000 |
| Max Repayment Term | Up to 7 Years (84 months) | Up to 5 Years (60 months) |
| Target Enterprises | Established industrial exporters & manufacturing suppliers | Startups & growing SMEs with at least 1 year track record |
| Permitted Uses | General working capital, business expansion, equipment procurement, trade financing | |
3. Eligibility Criteria for Cross-Border Merchants
- Hong Kong Registered Entity: Must hold a valid Business Registration Certificate (BR) and Certificate of Incorporation (CI);
- Substantive Operations: Must demonstrate genuine commercial operations with at least 1 year of business track record (or 3+ years for higher facilities);
- Good Credit History: Clear financial standing for both the applicant company and its principal shareholders;
- Authorized Lenders: Application submitted through participating financial institutions (HSBC, Standard Chartered, OCBC, BOC HK, etc.).
4. Frequently Asked Questions (FAQ)
Q Is the SFGS a direct cash grant from the government?
No. SFGS is a government-backed credit guarantee program, not a free grant. Administered by HKMC Insurance Limited (HKMCI), the Government guarantees 80% or 90% of commercial bank loans (HSBC, Standard Chartered, OCBC, BOC HK, etc.), enabling SMEs to secure favorable interest rates without heavy property collateral. Borrowers remain responsible for interest and principal repayment.
Q What are the differences between 80% and 90% Guarantee products?
The 80% Guarantee provides facility limits up to HK$18 million with loan tenures up to 7 years, tailored for established manufacturing and trade suppliers. The 90% Guarantee provides up to HK$8 million with tenures up to 5 years, designed with flexible eligibility for emerging SMEs and startups with at least 1 year of operating history.
Q Does applying for SFGS require local real estate collateral in Hong Kong?
A major advantage of SFGS is minimizing reliance on real estate collateral through government backing. However, lending banks require substantive Hong Kong business track records, 1-2 years of CPA audited accounts, personal guarantees from majority shareholders, and demonstrated repayment ability through active bank cash flow.
Q What are the permitted uses of SFGS loan proceeds?
Approved funds must be used for genuine business purposes: local staff payroll (MPF), commercial office rent, raw materials and inventory procurement, equipment leasing, or global market expansion. Funds cannot be used to pay off unrelated personal debt or high-risk investments.