PSG vs EDG: Which Grant Is Right for Your Business?
Two grants. Both co-fund your AI investment. But they work very differently. Here's which one is right for you.
If you've been looking into government grants for AI, you've probably seen two names pop up everywhere: PSG and EDG.
Both subsidise your AI costs. Both help Singapore businesses adopt technology. But they're actually quite different — like comparing buying a ready-made HDB flat versus building your own landed house. Let's break it down.
“Harnessed well, AI will be a strategic advantage for Singapore. It can help us overcome our structural constraints — our limited natural resources, rapidly ageing population and tight labour market.”
— PM Lawrence Wong, Budget 2026 Statement, 12 February 2026
In Budget 2026, PM Wong made it clear: AI is not optional for Singapore businesses anymore. The government is putting serious money behind this — $37 billion under the RIE2030 plan — and both PSG and EDG are key pillars of that strategy. Understanding which grant fits your business is the first step to making the most of it.
Important: How the Money Actually Flows
Neither PSG nor EDG gives you cash upfront. Both work as reimbursements — you pay first, use the tool or complete the project, then claim back a percentage from the government.
Think of it like your company medical benefits: see the doctor, pay the bill, then claim back. The government wants proof that you actually used the AI before they reimburse you.
PSG Reimbursement
Pick an approved tool → pay 100% upfront → use it for 30+ days → submit claim → get 50% back
EDG Reimbursement
Submit proposal → get approval → execute project at your own cost → submit invoices/receipts → get 50-70% back after completion (may require audit)
The Simple Explanation
PSG
“Pick from the menu”
The government has a list of pre-approved AI products. You browse the list, pick one that fits your business, pay for it upfront, then claim back 50% of the cost.
Think of it like buying from a menu. The dishes are already decided. You just choose.
- Fast — approved in 4 to 6 weeks
- Simple application — not much paperwork
- Up to S$30,000 per year
“We will expand the PSG to support a wider range of digital and AI-enabled solutions, so that every firm, regardless of size, can access tools that help them work smarter and compete more effectively.”
— PM Lawrence Wong, Budget 2026
EDG
“Build exactly what you need”
Got a specific business problem? No pre-made tool that fits? EDG co-funds someone to build a custom AI solution just for you. You execute the project at your own cost, then get reimbursed after completion.
Think of it like hiring a private chef. You tell them what you want, they cook it for you.
- Higher co-funding — government reimburses up to 70% for SMEs
- Typical projects: S$200K to S$700K
- Takes longer — 8 to 12 weeks to approve, months to complete
Let's Talk Money
This is the part everyone cares about. Here are the numbers — and remember, this is how much the government reimburses you after you pay and use the solution.
PSG
S$30,000
max reimbursement per year
You buy a S$12K AI booking system
You pay S$12,000 upfront
Government reimburses S$6,000 (50%)
Net cost to you: S$6,000
EDG
S$200K–700K
typical project size
You run a S$300K custom AI project
You pay S$300,000 throughout
Government reimburses S$210,000 (70%)
Net cost to you: S$90,000
See the difference? EDG handles much larger projects, and the government reimburses a bigger percentage (up to 70% for SMEs). But PSG is faster and easier for smaller, ready-made tools. It depends on what you need.
Side-by-Side: The Full Comparison
Here's everything in one table. No jargon, just facts.
| Question | PSG | EDG |
|---|---|---|
| How much can the government co-fund? | Up to S$30K/year | No fixed public cap, typical S$200K–$700K projects |
| Government pays how much? | 50% (reimbursement) | 50 to 70% (SMEs get 70%, reimbursement) |
| When do you get the money? | After 30+ days of use | After project completion + audit |
| Do you pay upfront? | Yes, 100% | Yes, throughout the project |
| How long to approve? | 4 to 6 weeks | 8 to 12 weeks |
| What can you buy? | Pre-approved AI tools only | Anything custom-built |
| Hard to apply? | Easy — simple form | More work — need a project plan |
| Company revenue limit? | Under S$100M | No limit |
| Can choose your own vendor? | No — must be from approved list | Yes — any qualified vendor |
Real-Life Examples
Still not sure? Here are real Singapore business scenarios showing which grant fits better — and exactly what the numbers look like.
PSG Examples (Pick from the Government List)
Hair salon — AI booking system
AI system that auto-suggests available slots and sends WhatsApp reminders to customers. Pick a pre-approved vendor from the government list.
Cost: S$6,000/year. Pay upfront.
Government reimburses: S$3,000 (50%).
Net cost to you: S$3,000/year.
Answer: PSG. Quick, simple, approved in weeks.
Hawker stall / coffee shop — AI POS system
AI point-of-sale system that tracks what sells, identifies peak hours, and auto-orders from suppliers when stock runs low.
Cost: S$4,000. Pay upfront.
Government reimburses: S$2,000 (50%).
Net cost to you: S$2,000.
Answer: PSG. Affordable AI, half the cost covered.
Tuition centre — AI student-tutor matching
AI system that matches students to tutors based on learning style, tracks progress, and auto-generates parent reports.
Cost: S$12,000. Pay upfront.
Government reimburses: S$6,000 (50%).
Net cost to you: S$6,000.
Answer: PSG. Ready-made solution from the list.
Neighbourhood clinic — AI appointment and patient reminders
AI system that manages patient appointments, sends SMS reminders for follow-ups, and reduces no-shows by 40%.
Cost: S$15,000. Pay upfront.
Government reimburses: S$7,500 (50%).
Net cost to you: S$7,500.
Answer: PSG. Quick, simple, approved in weeks.
EDG Examples (Custom-Built Solutions)
Car workshop chain — AI spare parts demand prediction
Custom AI that predicts spare parts demand by location based on neighbourhood car types, service history patterns, and seasonal trends. No off-the-shelf tool can handle this.
Project cost: S$200,000. You fund the project throughout.
Government reimburses: S$140,000 (70%) after completion.
Net cost to you: S$60,000.
Answer: EDG. Custom AI, government reimburses 70%.
Property agency — AI buyer-listing matching
Custom AI that analyses HDB resale prices, rental yields, and buyer preferences to auto-match buyers with the best listings. Trained on your agency's transaction data.
Project cost: S$300,000. You fund the project throughout.
Government reimburses: S$210,000 (70%) after completion.
Net cost to you: S$90,000.
Answer: EDG. Custom AI trained on your business data.
Food catering company — AI operations optimisation
Custom AI that forecasts event bookings, optimises menu pricing, and manages ingredient procurement across 3 kitchens. Completely tailored to your operations.
Project cost: S$250,000. You fund the project throughout.
Government reimburses: S$175,000 (70%) after completion.
Net cost to you: S$75,000.
Answer: EDG. Complex multi-kitchen AI, custom-built.
Printing/packaging factory — AI quality inspection
Custom AI for automated quality inspection on the production line. The AI learns what defects look like for your specific products — no generic tool can do this.
Project cost: S$400,000. You fund the project throughout.
Government reimburses: S$280,000 (70%) after completion.
Net cost to you: S$120,000.
Answer: EDG. Custom AI trained on your production line.
5 Quick Questions to Decide
Answer yes or no. In 30 seconds you'll know which grant is right for you.
Can you find what you need on the government's pre-approved list?
Yes → PSG. No → EDG.
Is your AI investment more than S$30,000?
Yes → PSG caps at S$30K/year. You need EDG for larger projects. No → PSG can cover it.
Do you need this done within 3 months?
Yes → PSG (faster approval, faster reimbursement). No → EDG is fine, but expect months from project end to payout.
Does your company make more than S$100M per year?
Yes → PSG is off the table, go with EDG. No → Both are available to you.
Do you need AI trained on your own business data?
Yes → EDG (custom work needed). No → PSG's ready-made tools should work.
Can You Get Both? Yes!
This is the best part. You don't have to choose. You can apply for both grants — as long as they co-fund different things. Think of it like using two different coupons at the same restaurant: one for the appetiser, one for the main course. You just cannot double-claim the same expense.
Stacking Example: F&B Chain with 20 Outlets
Here's how a food and beverage chain could use both grants together. Remember: you pay first, then get reimbursed for each.
Net: S$5K
Net: S$120K
for S$410K worth of AI systems
PSG co-funds the ready-made inventory software. EDG co-funds the custom AI that predicts how much food to prepare. Different expenses, no overlap, totally fine.
And if you really want to go all in, add ECI for computing costs and EIS for tax savings on top. Read our complete grants guide to see how stacking works.
Still Not Sure? Here's the Quick Rule
If a ready-made tool can solve your problem, go with PSG. It's faster, simpler, and gets AI into your business in weeks. You pay upfront, use it for a month, and claim back 50%.
If you need something built specifically for your business, go with EDG. The government reimburses a higher percentage, and you get exactly what you need — just be prepared to fund the project yourself first and wait for reimbursement after completion.
Not sure which category you fall into? Take our free assessment and we'll figure it out for you in 2 minutes.
Official References
All grant details and PM quotes referenced in this article are sourced from official Singapore Government publications.
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