Both PSG and EDG can fund AI adoption, but they serve different needs. PSG covers pre-approved AI tools with faster approval. EDG supports custom AI development with no funding cap. Use this guide to quickly decide which grant fits your AI project.
Budget 2026 Update: PSG will be expanded for AI adoption (details at COS 2026). A new EIS AI activity also provides 400% tax deduction on S$50K AI spend (YA 2027–2028). See Budget 2026 AI & Innovation Grants Overview for details.
What are the key differences?
- PSG is for pre-approved AI solutions: You pick from a catalogue of vetted AI tools (chatbots, analytics platforms, automation software) that are ready to deploy.
- EDG is for custom AI projects: You design your own AI solution (machine learning models, AI integration, process automation with AI).
- PSG has a S$30K annual cap: EDG has no funding limit for larger AI transformation projects.
- Don’t start before applying: No deposits, signed contracts, or AI development work before receiving your Letter of Offer.
Acronyms:
- PSG = Productivity Solutions Grant (pre-approved solutions)
- EDG = Enterprise Development Grant (custom transformation projects)
Which grant should you choose?
Use PSG if your AI solution is on the pre-approved list. Use EDG for custom AI development or when project costs exceed S$30K.
| PSG | EDG | |
|---|---|---|
| Pre-approved AI chatbot (customer service) | ✓ | — |
| Pre-approved analytics/BI platform with AI | ✓ | — |
| Pre-approved AI-powered CRM or HR system | ✓ | — |
| Custom machine learning model development | — | ✓ |
| AI integration into core business processes | — | ✓ |
| AI-powered product or service development | — | ✓ |
| AI solution not on PSG catalogue | — | ✓ |
| AI project exceeds S$30K | — | ✓ |
Legend: ✓ = Use this grant | — = Not applicable
How do they compare at a glance?
PSG offers faster approval with lower caps. EDG provides more flexibility for ambitious AI projects.
| PSG | EDG | |
|---|---|---|
| Funding cap | S$30K/year per UEN | No cap |
| Support rate | Up to 50% | Up to 50% (70% for sustainability AI) |
| Processing time | 4-6 weeks | 8-12 weeks |
| AI solution type | Pre-approved AI tools only | Custom AI projects |
| Consultant required | No | Yes (TR 43/SS 680 for consultancy) |
| Company size limit | ≤S$100M turnover OR ≤200 staff | No limit |
| Internal AI team costs | Not covered | Covered |
| Local shareholding | 30% minimum | 30% minimum |
How do you decide?
Start by checking if your AI solution is on the PSG catalogue. If yes, PSG is faster. If no, or if your project is custom, use EDG.
Step 1: Is your AI solution on the PSG catalogue?
Can you find your AI tool (chatbot, analytics, automation) on the PSG pre-approved list?
Step 2: What type of AI project?
- Customer service chatbot
- FAQ automation bot
- Lead qualification chatbot
- Business intelligence with AI insights
- Sales forecasting tools
- Inventory prediction software
- Custom ML model for your data
- AI-powered product features
- Proprietary AI algorithms
- AI embedded in manufacturing
- Automated quality control with AI
- AI-driven supply chain optimization
What are common scenarios?
- “I want an AI chatbot for customer service” → PSG (if the chatbot vendor is on the pre-approved list)
- “I need a custom AI model trained on my company data” → EDG (custom development, not pre-approved)
- “I want AI-powered analytics for sales forecasting” → PSG (if the analytics platform is pre-approved)
- “I’m building an AI-powered product for my customers” → EDG (product development under Innovation pillar)
- “I want to integrate AI into my manufacturing line” → EDG (process automation/redesign)
- “My AI project costs S$80,000” → EDG (exceeds PSG annual cap of S$30K)
- “I want to hire an AI consultant to assess our needs” → EDG (covers consultancy for AI strategy)
What should you know before applying?
- Check the PSG catalogue first at the Business Grants Portal — if your AI solution is listed, PSG is faster and simpler
- Don’t start AI development before submitting your application — no vendor contracts, no coding, no data preparation
- One UEN, one active PSG application at a time — plan your AI adoption phases accordingly
- EDG requires certified consultants for consultancy work — verify TR 43 or SS 680 certification
- EDG covers internal staff costs — if your team is building the AI, only EDG reimburses their time
- AI for sustainability may get 70% funding under EDG (until March 2026)
Is this comparison right for you?
This guide is for you if:
- You’re an SME considering AI adoption in Singapore
- You’re choosing between off-the-shelf AI tools vs custom AI development
- Your AI project budget is between S$10K and S$500K
Consider other options if:
- You need AI for overseas market expansion → Check MRA Decision Matrix for market-specific activities, then combine with EDG for AI
- You’re a large enterprise (>S$100M turnover) → PSG is not available; use EDG directly
- Your AI project is purely R&D → Consider Research Incentive Scheme for Companies (RISC)
In short: Use PSG for quick adoption of pre-approved AI tools. Use EDG for custom AI development or larger AI transformation projects.
Related Guides
- How to Choose? PSG vs EDG — general comparison without AI focus
- How to Choose? PSG vs EDG vs ADS — includes Advanced Digital Solutions for larger digital projects
- Productivity Solutions Grant (PSG) — full eligibility and application details
- Enterprise Development Grant (EDG) — full eligibility and project scope
- EDG Three Categories Explained — understand which EDG pillar fits your AI project
- Grant Pitfalls Guide — common mistakes to avoid when applying
- Corppass Setup Guide — step-by-step guide to set up Corppass for BGP access
- Singapore Grants Glossary
- Budget 2026 AI & Innovation Grants Overview — PSG AI expansion and EIS AI activity
- EIS Budget 2026 AI Changes — New EIS AI qualifying activity details
Official Links
Need help with your application?
Check if you're eligible and get your document checklist in 30 minutes.
Check Eligibility