Funding an AI project in Singapore: PSG, EDG and other support explained

Singapore offers more support for business digitalisation than most countries, and AI projects can often qualify. The difficulty is that the schemes have different purposes, different rules and different agencies behind them. Choosing the wrong one, or applying at the wrong moment, is the most common reason companies miss out.

Note: Grant criteria, funding levels and caps are set by the government agencies and are revised from time to time. This article explains how the schemes generally work. Always confirm current details on the Business Grants Portal, the Enterprise Singapore and IMDA websites, or with the agency directly before planning around a figure.

The two schemes most SMEs start with

Productivity Solutions Grant (PSG)

The PSG supports the adoption of pre-approved, off-the-shelf solutions. Vendors apply to have specific packages listed, and companies can then claim support for buying one of those packages. For AI, this typically covers listed solutions such as customer-service chatbots, document-processing tools or sector-specific software with AI features built in.

Key points:

• The solution and the vendor must be on the pre-approved list at the time you apply
• Funding support is a percentage of qualifying costs, up to a cap set for each category
• The application is relatively light, because the solution has already been assessed

PSG is best when an existing product does what you need with little customisation.

Enterprise Development Grant (EDG)

The EDG supports projects that help a company upgrade, innovate or grow, including customised technology projects. If you need an AI solution built around your own processes and data, rather than a packaged product, EDG is usually the more relevant scheme.

Key points:

• Projects are assessed on their merit, so you need a clear business case, scope and budget
• Qualifying costs can include third-party consultancy, software and equipment, and some internal manpower costs
• Applicants generally need to be registered and operating in Singapore, meet local shareholding requirements and be in sound financial position

EDG applications take more work. A well-written project proposal, with measurable outcomes, makes a significant difference.

How PSG and EDG compare

Other support worth knowing about

Beyond the two main grants, several programmes are relevant to AI work. Their scope and availability change more often, so treat this as a starting list for enquiry rather than a guarantee:

• AI Singapore programmes such as 100 Experiments, which have co-developed AI solutions with companies that have a suitable problem and data
• IMDA initiatives for digital and AI adoption, including programmes aimed at helping SMEs try generative AI with vetted solution providers
• The Enterprise Compute Initiative announced in Budget 2025, intended to help companies access AI tools, computing power and expertise through partnerships with cloud providers
• SkillsFuture funding for training staff, which can cover AI-related courses

Mistakes that cost companies their grant

Committing before applying

Most schemes require that you do not sign a contract, issue a purchase order or make payment for the project before submitting your application. Even a deposit can make the project ineligible. Build the application time into your plan.

A vague project scope

"Implement AI to improve efficiency" is not a project. Assessors look for a specific problem, a defined solution, clear deliverables and measurable outcomes, such as hours saved per month or reduction in processing time.

Mismatched quotations

The vendor quotation should match the scope described in the application. Inconsistencies in deliverables, timelines or costs create questions and delays.

Forgetting the claim requirements

Approval is not the end. Claims usually require evidence that the project was delivered as approved, and some schemes ask for outcome reporting after completion. Keep invoices, proof of payment, delivery documents and before-and-after measurements from the start.

Where a consultant fits

A consultant cannot guarantee approval, and you should be wary of anyone who claims otherwise. What we can do is help shape a project that is worth doing in its own right, define measurable outcomes, prepare a clear scope that vendors can quote against, and make sure the timeline respects the grant rules. If a project only makes sense with a grant, it usually is not a good project.

Frequently asked questions

Can we apply for PSG and EDG for the same project?

Generally no. The same qualifying costs cannot be funded twice by different government schemes. You may, however, use different schemes for different projects.

How long does an EDG application take to be assessed?

It varies with the size and complexity of the project and how complete the application is. Plan for several weeks at a minimum, and longer if the agency asks for clarifications.

Do foreign-owned companies in Singapore qualify?

Eligibility rules, including local shareholding requirements, differ by scheme. Check the current criteria for the specific grant before planning around it.