KUALA LUMPUR (Feb 21): The RM40 billion Semarak Niaga Keluarga Malaysia Programme launched on Monday (Feb 21) will increase the business sector’s access to financing, especially for micro, small and medium enterprises (MSMEs) and the informal sector.

Prime Minister Datuk Seri Ismail Sabri Yaakob said the programme includes direct loans, financing guarantees and equity injections for the benefit of every group of entrepreneurs.

“For micro and small businesses, the government is aware of their need for access to financing with low interest rates.

“In this regard, the Informal and Micro Financing Scheme (SPIM) will offer loans of up to RM10,000 at zero interest rate with priority given to informal sector traders. The fund size of this programme alone is RM200 million,” Ismail Sabri added.

“For agrifood entrepreneurs, the micro credit scheme by Agrobank will offer loans of up to RM75,000 at a 0% rate for the first six months, with a moratorium facility for up to six months,” he said when launching the programme here on Monday.

For more mature businesses, he stated that financial institutions such as SME Bank would offer loans of up to RM10 million under the IBS 2.0 Promotion Fund scheme and up to RM1 million under the Young Entrepreneur Financing Programme 2.0.

Collectively, Ismail Sabri said the fund size of the two schemes amounts to RM300 million.

“For companies that are viable but have constraints on obtaining new funds, the government and financial institutions have devised a new, more flexible form of financing to expand the ability to revive the business.

“One of them is through equity crowdfunding and peer-to-peer financing, which will be supported by an allocation of RM80 million in matching grants for the Malaysia Co-investment Fund, in addition to an investment by Bank Pembangunan Malaysia Bhd (BPMB) of RM100 million,” he said.

To help companies facing high indebtedness or gearing problems, Ismail Sabri noted that funding methods in excess of RM2.2 billion through equity and quasi-equity investments would also be available.

He said the method is being spearheaded by SME Bank with a fund of RM600 million, while BPMB would offer the RESET scheme, or Rehabilitation and Support Through Equity, with a fund size of RM500 million.

“Bank Negara Malaysia (BNM) has also provided a Business Recapitalisation Facility worth RM1 billion for the same purpose. Cumulatively, a total of RM14.2 billion in funds is available to SMEs.

“For continued availability of funds, BNM’s special funds, especially the Targeted Relief and Recovery Facility and the Agrofood Facility, have been collectively increased by RM2.5 billion to RM10 billion. The total amount available from various BNM SME funds is currently at RM10 billion,” Ismail Sabri said.

The prime minister added that the scheme under Syarikat Jaminan Pembiayaan Perniagaan, meanwhile, would provide guarantees for scheduled and restructured financing with a guarantee limit of RM22 billion, targeted to help companies secure new financing that was previously difficult to obtain.

“I would like to emphasise that these initiatives do not take into account improvements in the Keluarga Malaysia Flood Relief for the affected MSMEs that I have announced recently.

“Obviously, the Semarak Niaga Keluarga Malaysia Programme and the Keluarga Malaysia Flood Relief reflect the principle of Keluarga Malaysia where no one would be marginalised,” he said, likening it to a Malay proverb “berdiri sama tinggi, duduk sama rendah, bersukat sama paras, bertimbang sama berat” (given equal standing, as well as entitled to equitable sharing).

He said the Semarak Niaga Keluarga Malaysia Programme would complement the government’s efforts through the financial sector in providing financing facilities and loan repayment assistance, especially in the post-Covid-19 pandemic recovery phase.

Source: https://www.theedgemarkets.com/article/rm40b-semarak-niaga-programme-increase-financing-access-business-sector-—-pm