Governments support business lending mainly through partial guarantees to commercial lenders and through promotional banks. In the US the SBA guarantees up to 85% of small 7(a) loans and 75% of larger ones for for-profit businesses located in the US; Germany's KfW finances SMEs and start-ups on a state mandate; Singapore's Enterprise Financing Scheme covers seven loan types. Eligibility usually turns on local presence and size, so foreign-owned subsidiaries must check how affiliates are counted.
Guarantee schemes
The US SBA may guarantee up to 85% of a 7(a) loan of USD 150,000 or less and up to 75% above that. The borrower must be organised for profit, located in the US, small under SBA size standards counting affiliates, and able to show a need for credit; a US subsidiary of a large foreign group may therefore fail the size test. Singapore's Enterprise Financing Scheme supports working capital, fixed asset, venture debt, trade, project, M&A and green loans, though eligibility and risk-share details need checking on the scheme pages.
Egypt offers a different model: a cash incentive of 35 to 55 percent of income tax paid for industrial projects financed at least 50 percent in foreign currency.1234
Promotional and state banks
Germany's KfW carries out promotional financing on a state mandate for SMEs, the liberal professions and start-ups, as well as innovation, environment and infrastructure. It may finance exports and projects outside the EU and EEA only in consortia or where other financing is insufficient, and it may not take deposits. UK Export Finance states that it operates at no net cost to the taxpayer, which explains why its guarantees carry premiums.567
| Market | Scheme | Key figure or condition | Source |
|---|---|---|---|
| United States (federal) | SBA 7(a) guarantee | 85% up to USD 150,000; 75% above | 13 CFR 120.210 |
| United States (federal) | SBA eligibility | For profit, located in US, small with affiliates | 13 CFR 120.100 |
| Germany | KfW promotional finance | SMEs, professions, start-ups on state mandate | KfW Law § 2 |
| Singapore | Enterprise Financing Scheme | Seven loan types | Enterprise Singapore |
| Egypt | Foreign-currency financing incentive | 35% to 55% of income tax paid | GAFI |
Decisions to make
- Does the local subsidiary count as small once its foreign affiliates are included?2SBA size is measured including affiliates.
- Is the scheme delivered through the company's own bank?13SBA and Enterprise Singapore schemes work through participating lenders, so the bank relationship comes first.
- Is the project export or SME finance that a promotional bank such as KfW is mandated to support?56KfW's mandate sets what it can finance and where.
Documents usually needed
- Business plan and use-of-funds statement
- Group structure and affiliate data for size tests
- Financial statements and cash-flow forecasts
- Lender's credit application and scheme-specific forms
Common mistakes
- Assuming a foreign-owned subsidiary qualifies as small without counting the group
- Expecting the government to lend directly when the scheme is a guarantee to the lender
- Treating guarantee cover as relief from the borrower's own repayment obligation
Questions businesses ask
Can a foreign-owned US subsidiary get an SBA-guaranteed loan?
It must be for-profit, located in the US and small under SBA size standards including affiliates. SBA policy on foreign ownership was not confirmed.2
How much of a loan does the SBA guarantee?
Up to 85% for loans of USD 150,000 or less and up to 75% for larger loans, unless otherwise authorised by law.1
What this guide does not yet confirm
These points need checking with a qualified local professional before you rely on them.
- UK British Business Bank schemes (such as the Growth Guarantee Scheme), France's Bpifrance, India's CGTMSE, Saudi Arabia's Kafalah and SIDF, and UAE federal and emirate schemes could not yet be checked and are not covered.
- SBA citizenship and foreign-ownership eligibility policy and maximum loan size were not confirmed.
- Enterprise Singapore eligibility, loan caps and risk-share percentages were not shown on the page read.
Sources and review status
Each statement is numbered to the source it was checked against. We use official sources where we can, and each statement says whether it was checked against an official or a secondary source. Sources last checked on 19 October 2026. None of it has been professionally reviewed yet: it is research checked against official and secondary sources by WONE Global, not legal or tax advice.
The US Small Business Administration may guarantee up to 85% of a 7(a) loan of USD 150,000 or less and up to 75% of a larger loan, unless otherwise authorised by law. Federal. 13 CFR 120.210. The loan is made by a participating lender, which keeps the unguaranteed share.
To be eligible for an SBA business loan, an applicant must be organised for profit, located in the United States, small under SBA size standards including affiliates, and able to show a need for the credit. Federal. 13 CFR 120.100. Size is measured including affiliates. SBA policy on foreign ownership of borrowers was not confirmed.
Singapore's Enterprise Financing Scheme supports bank lending to Singapore enterprises across seven loan types: green, working capital, fixed asset, venture debt, trade, project, and mergers and acquisitions loans. Singapore. Eligibility, maximum loan amounts and the government's risk-share percentage were not shown on the page read.
Industrial projects financed at least 50 percent in foreign currency may receive a cash incentive of 35 to 55 percent of the income tax paid, depending on the foreign-currency share. Article 11 bis and Prime Minister Decree 77/2023; operations must start within six years.
Reused from market guide claim eg-regulatory-002.
KfW, Germany's federal promotional bank, carries out promotional financing on a state mandate for small and medium-sized businesses, the liberal professions and business start-ups, among other areas such as innovation, environment and infrastructure. Federal. § 2(1) No. 1(a) KfW Law; these tasks are carried out by the KfW Mittelstandsbank unit (§ 2(2)).
KfW may provide export and project finance outside the EU, the EEA and EU candidate countries only in consortium arrangements or where financing offers are otherwise insufficient, and it may not take deposits from the public. Federal. § 2(1) No. 4(b) and § 2(3) KfW Law.
UK Export Finance is a ministerial department whose stated aim is that no viable UK export fails for lack of finance or insurance, and it states that it works at no net cost to the taxpayer. UK. Relevant when comparing state-backed guarantees with commercial cover, since UKEF charges premiums.
Questions on this topic
6 statements on government funding and guarantees
