Singapore SME AI Grants: PSG, EDG, and What Qualifies in 2026
Singapore's government has made AI adoption affordable for SMEs through two primary grant schemes: the Productivity Solutions Grant (PSG) and the Enterprise Development Grant (EDG). Used correctly, these grants can offset 50–70% of qualifying AI project costs.
This guide covers what each grant covers, what AI projects typically qualify, and what to prepare before applying.
Productivity Solutions Grant (PSG)
The PSG supports SMEs in adopting pre-approved IT solutions and equipment that improve productivity. For AI adoption, the most relevant PSG-supported categories include:
- Customer Management — CRM systems with AI features
- Data Analytics — business intelligence and reporting tools
- Inventory Management — AI-assisted stock and supply chain tools
Support level: Up to 50% of qualifying costs (as of 2026; check GoBusiness.gov.sg for current rates).
Eligibility:
- Business entity registered and operating in Singapore
- Minimum 30% local shareholding
- Group annual sales turnover ≤ S$100 million, or group employment size ≤ 200 employees (for selected solutions)
PSG works best for standardised, pre-approved solutions. If you're adopting an AI tool that's already on the pre-approved list, PSG is the fastest path to funding.
Enterprise Development Grant (EDG)
The EDG supports more substantial business transformation projects, including custom AI development and process redesign. It covers projects under three pillars: Core Capabilities, Innovation and Productivity, and Market Access.
For AI agent deployments, the most relevant pillar is Innovation and Productivity — specifically, process redesign and automation projects.
Support level: Up to 50% of qualifying project costs for SMEs (as of 2026).
What qualifies under EDG:
- Custom AI workflow automation (e.g., document processing, compliance monitoring)
- Business process redesign supported by AI tools
- Technology roadmap development with AI as a core component
What the grant covers:
- Consultant and vendor fees
- Software and development costs directly tied to the project
- Internal manpower costs (at a capped rate)
EDG works best for custom, project-based AI implementations where you're building something specific to your operations rather than purchasing an off-the-shelf tool.
Structuring Your AI Project to Qualify
Grant applications are more likely to succeed when the project is scoped clearly and tied to measurable business outcomes. For EDG in particular:
- Define the business problem — not "we want AI" but "we manually process 200 vendor invoices per week; we want to reduce this to 10 minutes of review per day"
- Map the current process — document the steps, who does them, how long they take, and what errors occur
- Define the future state — what the automated process looks like, what metrics improve, and by how much
- Quantify the impact — EDG assessors look for FTE savings, error reduction, or revenue enablement — give them numbers
AI agent projects are well-suited to this framing because they target specific, measurable workflows.
Common Mistakes to Avoid
- Applying for PSG when the solution isn't pre-approved — check the approved vendor list before committing
- Submitting EDG applications after the project starts — EDG requires pre-approval; work done before the grant is approved is not fundable
- Underspecifying the scope — vague applications get rejected or return with requests for clarification that slow down timelines
Frequently Asked Questions
What is the PSG grant for AI in Singapore?
The Productivity Solutions Grant (PSG) subsidises Singapore SMEs adopting pre-approved IT solutions, including AI-enabled tools for customer management, data analytics, and inventory management. The current support level is up to 50% of qualifying costs. Unlike EDG, PSG does not require a consultant-led application — you select a pre-approved vendor and apply via GoBusiness.gov.sg.
Can I use EDG for custom AI agent development?
Yes. The Enterprise Development Grant (EDG) covers custom AI implementations under its Innovation and Productivity pillar — including bespoke AI workflow automation, document processing agents, and compliance monitoring systems. Qualifying costs include consultant and vendor fees, software development, and capped internal manpower costs. EDG requires pre-approval before work begins.
Do I need to apply before starting my AI project?
For EDG, yes — work done before grant approval is not fundable. This is the most common mistake SMEs make. PSG is more flexible on timing for some solutions, but pre-approval is still advisable. Both grants require the project to be scoped and documented before submission.
What AI adoption grants are available for SMEs in Singapore?
The two primary schemes are PSG (for standardised, pre-approved AI tools) and EDG (for custom AI projects and process redesign). IMDA's Infocomm Media Development Authority also runs sector-specific programmes periodically. Enterprise Singapore is the administering body for both PSG and EDG — GoBusiness.gov.sg is the single portal for applying.
What is the EDG support level for AI projects?
Up to 50% of qualifying project costs for SMEs (as of 2026). This covers consultant fees, vendor fees, and direct software costs tied to the project. Internal manpower is claimable at a capped rate. Rates are subject to change — check enterprisesg.gov.sg for current figures before scoping your project.
Next Steps
The best starting point is a workflow audit — map your highest-volume, most repetitive processes before choosing which grant to apply for. Once you know the scope, your implementation partner can help you prepare the EDG application with the required documentation.
ADV Digital Labs works with Singapore SMEs on PSG and EDG-eligible AI agent projects. We help scope the project, prepare the documentation, and deliver the implementation. Get in touch to discuss whether your project qualifies.
See also: AI opportunity assessment framework · PDPA compliance and AI agents
