Government

Singapore Extends Lockdown Period; Imposes Stricter Covid-19 Measures

Posted on by Samantha Tansy

The May 04, 2020 end-date of the “circuit breaker” (lockdown) period mandated by the government of Singapore in April 07, 2020 has been moved to June 01, 2020.

When on April 19, 2020, Singapore’s more than 20,000 number of confirmed Covid-19 cases became the highest in Southeast Asia, the need to extend and impose stricter measures became evident. The “circuit breaker” approach that entailed only the closing down of nonessential businesses and limiting entry to essential establishments to ensure safe distancing, now includes orders for Singapore residents to stay-at-home.

Leaving one’s home must be as infrequent as possible and limited only to performing essential tasks; such as buying of food and necessities, as well as engaging in exercise. Moreover, only one person per household must carry out an essential task, which denotes that going out in groups is not permitted.

Impact of the Extended Circuit Breaker Period on Businesses

The extension of the “circuit breaker” period also meant prolonging the period in which nonessential businesses remain closed. On the other hand, companies operating under limited conditions resulting in less income, whilst incurring the same overhead costs, all the more needed to apply cost-cutting measures.. In many cases, employers were constrained to retrench employees or put them under a no-pay leave arrangement.

Still, companies who had to retrench were under obligation to pay a final retrenchment compensation package. However, the retrenchment package depended on the financial capabilities of a business, since the effects of the COVID-19 have been felt by business owners as early as January, 2020.

 

Although the government has already released three stimulus relief packages aimed at providing financial assistance to different sectors, including retrenched employees and those under a no-pay leave arrangement, many had expected the “circuit breaker”/lockdown period to end last May 04, 2020. The announcement of the extension to June 01 has prompted many to scout for licensed money lenders from whom individuals could borrow additional funds.

 

Why Singaporeans Choose to Borrow Money from Licensed Money Lenders

Singaporeans prefer to borrow money from licensed money lenders because the latter group is strictly prohibited from practicing predatory lending schemes. Mainly because money lenders in Singapore can acquire a license to operate as a financing company, only if they pass a written licensing test.

The qualifying test aims to ascertain an applicant’s knowledge of the rules and policies legislated under the country’s Moneylenders Act. The Office of the Registry of Moneylenders administers the test as well as undertake the vetting process to determine an applicant’s eligibility to operate as a licensed money lender.

The money lending rules include basing the rate of interest on the current nominal rate, which at present is pegged at 4%. There are also stipulations that limit the type and amount of fees that money lenders can collect from borrowers, including penalty and other charges applied on past due loans.

Since the lending rules and regulations are quite extensive, those still not familiar with the provisions of Singapore’s Moneylenders’ Act can find the related information at the Singapore Ministry of Law website under the Info for Money Lenders and Info for Borrowers tabs.

Fed Chair : Control Virus First

Posted on by Samantha Tansy

Federal Reserve Chairman Powell agrees with health experts, saying control of Covid-19 spread should be the first order; not getting people back to work.

Jerome Powell, the financial expert whom Donald Trump appointed as Chairman of the Federal Reserve Bank commented that the U.S. may very well be in a recession at present because of the Covid-19 crisis. Yet he gave assurance that the country’s central bank is not likely to run out of funds even if the federal government releases the Congress-approved $2.2 trillon Coronavirus Relief Package (The CARES Act).

The Federal Reserve Chair, who rarely agrees to appear in a TV broadcast, did not give assurance on how soon the U.S. can get out of the economic slump as a result of the ongoing lockdowns. What he said in the NBC Today show last Thursday is for us to listen to the health experts, on what they are warning and instructing us to do about the pandemic.

Although Mr. Powell said there is “no blank check” to guarantee unlimited financial resources, which the federal bank can provide to support the country’s economy, he gave assurance that there is a tremendous amount the federal reserve bank could do in getting America through the Covid-19 dilemma. He said

“We have the ability to use our emergency lending authorities” … “The federal bank can continue to create loans that aim to support the flow of credit into the U.S. economy.”

The Federal Reserve Chair though, cannot say for how long the country will remain in recession, mainly because he agrees with Dr. Fauci’s statement that the virus will set the timetable. That is why he strongly recommends that the first order of business is to put the spread of the contagion under control, before considering resuming economic activity.

 

Apparently, Mr. Powell’s statement voices his disagreement with president Donald Trump’s current focus on ending the 15-day period set for the nationwide observance of social distancing restrictions.

The Significance of the Federal Reserve Chair’s Assurances

As chair of the Federal Reserve bank, Jerome Powell’s statements are assurances that businesses do not have to worry about investors pulling out support Mr. Powel has explicitly stated that

The Federal Reserve system can support things through the bank’s emergency powers.” ”Where credit is not flowing, the central bank can, and will step in to offer loans.”

The recently legislated Coronavirus Aid, Relief, and Economic Security (CARES) Act aims to do just that; aside from giving the American public financial assistance, there are several offers of relief and economic security extended to businesses that provide the sources of livelihood to workers and their families.

Even if businesses end up getting drained of resources once the coronavirus crisis is over, the federal government has already readied economic stimulus loans as a means of helping businesses get back in shape. That way, employees and workers can go back to work without fear of getting laid off and with assurance that they will receive compensation.

Still, there is a possibility that once the economic activities resume, some small to medium scale businesses will find it difficult to recover quickly. The state of California for one, which is touted as America’s largest economic contributor, has as many as 19.6 million people making up the country’s labor force. The San Francisco Bay Area, in which seven counties were the firsts to order lockdown and shelter-in-place measures, saw the immediate shut down of non-essential businesses.

Such businesses could have a need for a bankruptcy attorney san diego based may be, to help them manage financial distresses that could lead to bankruptcy.