What is BUD Fund in Hong Kong? How It Supports SMEs

The BUD Fund Hong Kong is driving growth for local SMEs as the city strengthens its position as a leading hub for business innovation and international expansion. Since its launch, the fund has opened new opportunities for companies to upgrade operations, build brand recognition, and explore markets beyond Hong Kong. Its support for marketing initiatives, market research, and digital projects allows businesses to innovate and scale more effectively.

These advantages, combined with Hong Kong’s strategic location, business-friendly regulations, and access to regional talent, make the BUD Fund a practical tool for companies aiming to compete locally and globally.

In this article, we explore how the BUD Fund Hong Kong works, who qualifies, and how businesses can maximise its benefits for sustainable growth.

What is the Hong Kong BUD Fund for SMEs?

The Hong Kong BUD Fund, officially known as the Branding, Upgrading, and Domestic Sales Fund, was established to help small and medium-sized enterprises upgrade operations, strengthen branding, and expand into new markets. Launched by the Trade and Industry Department, the fund reflects Hong Kong’s commitment to supporting innovation, internationalisation, and sustainable business growth:

• 2008: BUD Fund launched to support SME growth and internationalisation.
• 2013: Fund expanded to include support for digital projects and e-commerce initiatives.
• 2017: Maximum funding per project increased, and the co-funding structure was clarified.
• 2025: Guidelines updated to encourage measurable outcomes and innovative business strategies⁽¹⁾.

Since its introduction, thousands of local SMEs have leveraged the program to improve competitiveness and explore opportunities in Mainland China and overseas markets.

The launching purpose and how it helps businesses

The primary goal of the Hong Kong BUD Fund is to provide financial support for projects that drive measurable business development.

In particular, companies can receive funding for initiatives such as marketing campaigns, brand promotion, market research, feasibility studies, and digital projects. The fund typically covers up to 50 percent of eligible project costs, with businesses contributing the rest.

Key takeaways for applicants

Reading through these guidelines is crucial for a successful BUD Fund Hong Kong application. In reality, businesses that plan carefully, focus on measurable outcomes, and use the funds to support concrete growth initiatives are far more likely to secure approval.

In the coming years, the BUD Fund in Hong Kong will remain a practical tool for SMEs seeking to innovate, scale, and compete effectively in a rapidly changing market.

Eligibility and types of projects supported

Understanding who can apply and what the fund supports is the first step toward using the bud fund in Hong Kong effectively.

Which businesses are eligible?

To qualify for the fund, applicants must meet the following conditions:

• Non-listed enterprises registered in Hong Kong under the Business Registration Ordinance.
• Substantive business operations in Hong Kong, supported by evidence such as tax filings, MPF contributions, employment records, or commercial contracts.
• Clear commercial track record, showing active business activities rather than dormant or shell entities.
• Project objectives aligned with fund goals, namely branding, operational upgrading, or market expansion beyond Hong Kong.

Although the fund historically targeted SMEs, current guidelines focus less on company size and more on whether the applicant operates genuinely in Hong Kong and proposes a project with measurable business impact⁽²⁾.

What does its scope cover?

The fund supports projects that aim to develop business in:

• Mainland China
• Economies with which Hong Kong has signed FTAs or IPPAs, covering around 40 markets globally

This means projects that focus purely on local Hong Kong promotion without an external market element generally fall outside the fund’s scope⁽³⁾.

Funding is provided on a matching basis, where the government covers up to 50 percent of approved project costs, subject to cumulative funding limits. Each enterprise may receive up to HK$7 million in total funding across approved projects, with a maximum number of projects allowed per company⁽⁴⁾.

What types of projects are supported?

The Branding, Upgrading, and Domestic Sales Fund supports a wide range of initiatives, provided they contribute directly to market development and competitiveness.

Branding and marketing initiatives may include:

• Brand positioning and rebranding strategies for overseas markets
• Digital and offline marketing campaigns targeting Mainland China or FTA economies
• Participation in international trade fairs and exhibitions

Market research and feasibility studies may cover:

• Consumer demand analysis in new markets
• Competitive benchmarking and pricing studies
• Regulatory or market entry assessments

Upgrading and digitalisation projects may include:

• Development or enhancement of e-commerce platforms
• Website localisation for overseas customers
• Adoption of digital tools to improve sales, logistics, or customer engagement

Many successful applicants combine funded activities with internal resources. For example, a company may rely on in-house staff for daily operations while using the funds to engage external consultants for overseas market research or digital platform development. This approach improves cost efficiency and strengthens project credibility during assessment.

How to apply for Hong Kong BUD Fund

Applying for the BUD fund in Hong Kong follows a structured process designed to assess both project quality and business readiness. Below is the step-by-step guide for the application.

Step 1: Define the project scope and objectives

To begin with, applicants should outline a project that directly supports branding, upgrading, or market expansion outside Hong Kong. At this stage, objectives should remain specific and measurable.

For example, entering a defined overseas market or strengthening brand recognition within a target industry provides clearer direction than broad growth statements. Projects with well-defined commercial logic are generally assessed more favorably.

Step 2: Prepare a detailed project plan and budget

Once objectives are set, the next step involves preparing a comprehensive project plan supported by a realistic budget. Each cost item should clearly link to a specific activity and expected outcome. Since the fund operates on a matching basis, businesses must also demonstrate their ability to fund at least 50 percent of total project costs.

Moreover, implementation timelines should suit the actual operational capacity, as overly aggressive schedules may raise concerns during vetting.

Step 3: Complete the official online application form

After finalising the project plan, applicants must submit the application through the official BUD Fund online portal administered by the Hong Kong Productivity Council. The electronic form captures company details, project scope, budget allocation, and expected results.

At this point, consistency becomes critical. Information provided in the form should align fully with the project proposal and supporting documents. Otherwise, discrepancies may lead to clarification requests and processing delays.

Step 4: Submit supporting documents

In addition to the application form, applicants must upload documents that demonstrate both operational substance and financial credibility. These typically include:

• Business Registration Certificate
• Financial statements or management accounts
• Proof of substantive business operations in Hong Kong
• Quotations or contracts related to project expenses

Further details on documentation requirements are also available on the Trade and Industry Department website.

Step 5: Respond to clarification requests if required

Following submission, applications undergo vetting. During this stage, authorities may request additional information or clarification. When this happens, timely and clear responses help maintain momentum and signal strong project ownership.

In many cases, proactive communication can also prevent minor issues from delaying approval.

Step 6: Await evaluation and approval

Finally, applications under the Branding, Upgrading, and Domestic Sales Fund are evaluated based on feasibility, effectiveness, measurable outcomes, and financial prudence. Therefore, projects that demonstrate realistic execution, clear market impact, and disciplined budgeting stand a stronger chance of approval.

Overall, applicants who approach the process as a structured business proposal are more likely to achieve successful and timely outcomes.

Common challenges and post approval requirements

Even with a strong business idea, many companies encounter obstacles during a BUD fund Hong Kong application.

Common challenges during the application stage

One frequent challenge is incomplete or inconsistent documentation. Missing financial records, insufficient proof of substantive operations, or discrepancies between the application form and the project proposal often result in clarification requests or extended processing time.

Another challenge relates to unclear project objectives. Applications that describe general growth ambitions without clearly linking them to branding, upgrading, or domestic sales outcomes tend to score lower during assessment.

Unrealistic budgeting is also a common issue. Overestimated costs, vague expense categories, or project timelines that exceed operational capacity may raise concerns about financial prudence. Since the fund operates on a matching basis, applicants must demonstrate both sound cost control and the ability to fund their portion of the project.

Practical ways to improve success rates

Early preparation remains one of the most effective solutions. Developing a structured project plan with defined objectives, implementation steps, and performance indicators improves clarity and credibility. Clear KPIs such as targeted market entry, channel expansion, or customer acquisition help demonstrate feasibility.

Some businesses can also benefit from the help of professional service providers like BBCIncorp for process efficiency, particularly when preparing budgets and aligning project scope with assessment criteria.

Post approval obligations

After approval, fund recipients must submit progress and final reports that document project execution, milestones achieved, and outcomes compared with approved objectives.

Financial accountability is equally critical. Businesses must retain invoices, contracts, and payment records to support claims for reimbursement. Depending on project size, independent verification or audited statements may be required.

Please keep in mind that the Trade and Industry Department conducts ongoing compliance monitoring to ensure funds are used strictly within the approved project scope. Consequently, any significant project changes require prior approval.

Managing the fund effectively

To foster smooth fund management and maintain future eligibility, businesses should follow approved plans closely, maintain transparent records, and communicate promptly with authorities when clarification is needed. If you demonstrate disciplined execution and measurable results, you will place your business in a stronger position for future bud fund in Hong Kong applications.

Conclusion 

The BUD fund in Hong Kong represents a strategic opportunity for SMEs to enhance competitiveness, improve operational capabilities, and expand into new markets. However, a successful BUD fund Hong Kong application requires careful planning, well-defined objectives, and disciplined execution. Your projects should demonstrate alignment with the fund’s objectives and deliver measurable outcomes, such as market entry, revenue growth, or operational improvements.

Maintaining accurate budgets, comprehensive documentation, and timely submissions is essential, while keeping detailed records facilitates post approval reporting. Thus, working with experts on local matters can further strengthen proposals and mitigate common challenges.

Enterprises interested in incorporation or operating in Hong Kong can contact our team at service@bbcincorp.com for professional guidance and company services. BBCIncorp is always ready to assist with business requirements and needs.

---

References:

(1) https://www.tid.gov.hk/budfund

(2) https://www.tid.gov.hk/en/our_work/support_for_trade_industry/bud.html

(3) https://www.smelink.gov.hk/

(4) https://www.bud.hkpc.org/

Share this article