EDG Grant for Custom Software: What You Need to Know

While the Productivity Solutions Grant (PSG) covers off-the-shelf software, many SMEs need custom solutions — a bespoke ERP, a tailored e-commerce platform, or a proprietary automation system. The Enterprise Development Grant (EDG) is designed for exactly this: funding customised technology projects that improve business capabilities. With support of up to 50 percent of qualifying costs (up to 70 percent for qualifying sectors), EDG can cover a significant portion of your custom-software investment.

What Does EDG Cover for Custom Software Projects?

EDG funds projects under three pillars: Core Capabilities, Innovation and Productivity, and Market Access. Custom software typically falls under Innovation and Productivity. Qualifying costs include:

• Third-party consultancy and development fees — the cost of engaging a software-development partner to design, build, and deploy the system.
• Software and cloud-infrastructure costs — licences, hosting, and tools required for the project (typically for the first year).
• Training costs — getting your team proficient on the new system.

Internal salaries for staff working on the project are generally not covered. The grant is designed to support external expertise that the SME does not have in-house.

How Do You Make a Strong EDG Application for Software?

The evaluation panel assesses project quality, business impact, and implementation capability. Stand out by:

1. Documenting the business problem thoroughly — include data: "Our manual order-processing system handles 200 orders/day. Error rate is 8 percent, costing SGD 4,000/month in rework and customer credits."
2. Presenting a clear solution architecture — show how the custom software addresses the documented problems. Include a system diagram, feature list, and expected performance benchmarks.
3. Quantifying ROI — project the financial impact over 3 years. Example: "Automation will reduce errors to 1 percent, saving SGD 3,600/month, and increase throughput by 40 percent, supporting SGD 500,000 in additional annual revenue without additional headcount."
4. Choosing a credible development partner — include your vendor's portfolio, relevant case studies, and team credentials. The panel wants confidence that the project will be delivered successfully.
5. Providing a realistic timeline and budget — overly optimistic timelines or inflated budgets raise red flags. Benchmark your costs against industry rates.

What Are Common EDG Application Pitfalls?

The same mistakes that plague PSG applications apply here, plus a few specific to custom projects:

• Scope that is too vague — "build a digital platform" is not a scope. Define specific modules, features, and deliverables.
• No clear differentiation from off-the-shelf — the panel will ask why you cannot use a pre-approved PSG solution instead. Explain what is unique about your business process that requires custom development.
• Weak vendor selection justification — if you only obtained one quotation, it raises questions. Get two to three quotes and justify your choice based on capability, not just price.

Frequently Asked Questions

Can a startup apply for EDG?

Yes, but the company must be registered in Singapore and have been in operation for at least three years. Newer companies may qualify under startup-specific programmes like Startup SG Tech instead.

How long does EDG approval take for software projects?

Typically 8 to 12 weeks. Complex projects or applications requiring clarification may take longer. Do not begin any development work before receiving the Letter of Offer — costs incurred before approval are not reimbursable.

Can I claim EDG for ongoing software maintenance after the project?

No. EDG covers project-based development, not recurring operational costs. Maintenance, hosting, and support fees after the project completion date are your responsibility. Budget for these in your total cost of ownership analysis.