Chapter 6 - SME Corporation Malaysia

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CHAPTER 698 National SME Development Council SME ANNUAL REPORT 2009/10Enhancing Access to FinancingNew Programmes and Financial Facilities in 2010The Government has allocated a total of RM5.9 billion for 39 programmes tobe implemented in 2010 to further enhance access to financing for SMEs forworking capital and business expansion locally and globally, as well as to assistSMEs at the start-up and early stage. There have been seven new schemesestablished in 2010 to assist SMEs, particularly in the services and agriculturesectors, as well as to promote entrepreneurship among micro enterprises andschool leavers.Table 6.3New programmes in 2010Ministry/Agency Programmes (RM million)JPM - FELDA Skim Insentif Usahawan Felda (SIUF) 10MOFMOFMID SabahMID SabahMID SabahMID SabahCreative Industry(Bank Simpanan Nasional)Ar-Rahnu Micro Programme(Yayasan Pembangunan EkonomiIslam Malaysia)Sabah Bumiputera EntrepreneurFinancing Scheme (SPUBS)Sabah Women EntrepreneurFinancing SchemeSME Machine and MachineryPurchase Aid SchemeFinancing Scheme for TechnicalSchool Leavers and WorkshopOwners501482.83.41.22.2Total 217.6Source: SME Integrated Plan of Action 2009, SME Corporation MalaysiaThe new and early start-up companies may avail to various specific schemes,such as:• Skim Belia Tani-i/Skim Belia Niaga (Agrobank);• Initiative Financing Scheme (AIM);• PUNB SME Scheme (formanufacturing and servicessector) and PUNB PROSPERSchemes (for retail anddistributive trade sector);• Financing Scheme for TechnicalSchool Leavers and WorkshopOwners (SEDCO Sabah); and• Financing Scheme for SMEsto Purchase Machines andEquipment (SEDCO Sabah).During the year, Government grantswill be continuously rationalised in amove to enhance its effectiveness,with the intention to be graduallyphased out and replaced with softloans or reward-based schemes.The more sustainable financingschemes would promote goodcredit culture and enhance financialdiscipline among SMEs as well as toexpand its utilisation to more SMEsbesides preparing the borrowers tomove towards a market basedscheme in future. As a CentralCoordinating Agency, SME Corp.Malaysia is also tasked to ensure thatfinancial assistance schemes by allrelevant Ministries and GovernmentAgencies across all economic sectorsare monitored for its effectiveness infacilitating SMEs to progress up thevalue chain. SME Corp. Malaysia alsopromotes financial inclusion for SMEsespecially microenterprises. In thiscontext, the expected outcome of thevarious financing schemes will bemonitored in the following areas:
National SME Development CouncilSME ANNUAL REPORT 2009/1099CHAPTER 6• Non-performing loans;• Viability of SMEs after two yearsfrom receiving the financialassistance;Enhancing Access to Financing• Business improvement in termsof turnover and profitabilitygrowth;• Increase in number of ruralentrepreneurs with highermonthly income; and• Increase in number ofentrepreneurs developed.New Financing Schemes Introduced in 2010In addition, SME Corp. Malaysiawill assess and ensure SMEs inthe new growth areas haveadequate accessibility to financing,at a reasonable cost. Theseinitiatives are in line with theGovernment’s vision to integrateSMEs into the New EconomicModel (NEM) that will primarilybe based on innovation, creativityand high value-added services, aswell as human capital development.The Creative Industry Fund (CIF) amounting to RM200 million announcedduring the 2010 Budget is administered by Bank Simpanan Nasional (BSN).The Scheme is to finance activities such as film and drama productions, music,animation, advertisements and local content development, with the intentionof boosting commercial activities in the local creative industry. Eligible SMEswill be extended credit facility ranging from RM50,000 to RM5 million atcompetitive interest rates of between 2% to 4% for a duration of up to fiveyears.The Government announced the RM1.5 billion Green Technology FinancingScheme (GTFS) during the Budget 2010 speech in October 2009 to promoteinvestments in Green Technology. The Government provides a guarantee of60% on the financing amount via the Credit Guarantee Corporation Berhad(CGC), while the remaining 40% financing risk is borne by the participatingfinancial institutions. The Scheme came into effect on 1 January 2010 for aperiod of three years or until the Scheme limit of RM1.5 billion is reached.Malaysia Green Technology Corporation (formerly known as Pusat TenagaMalaysia) has been tasked to conduct technical audits on applicants of thescheme which include green technology providers as well as users of greentechnology, to ascertain eligibility. Applicants who are eligible will be awarded aGreen Technology certificate, which will then entitle them to apply for financingunder the GTFS. As at 9 July 2010, 33 projects have been awarded the GreenTechnology certification, with potential financing amounting to RM957 million.Four projects have been granted financing under GTFS, with total financingamount of RM108.3 million.
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Chapter 6 - SME Corporation Malaysia

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