Banks remain supportive towards lending to Small and Medium Enterprises during COVID-19

April 8, 2020

Kuala Lumpur, Wednesday, 8 April 2020 – The Association of Banks in Malaysia (ABM) wishes to assure the Small and Medium Enterprises (SMEs) that financing from ABM member banks is readily available to eligible borrowers. As the nation is battling to contain the spread of COVID-19, our member banks are playing a vital role to provide access to financing especially to viable businesses that have been adversely affected by the outbreak of COVID-19. Bank Negara Malaysia (BNM) announced on 27 March 2020, that it would be increasing the allocation to BNM’s Fund for SMEs by RM4.0 billion, bringing the total allocation to RM13.1 billion. This fund, which is aimed at providing assistance to more SMEs in sustaining business operations and preserving jobs as well as to support economic growth, will be made available to the SME segment via the participating financial institutions. Interested SMEs are encouraged to contact the participating banks to apply for the financing available under the various facilities announced by BNM.

As at 2 April 2020, financial institutions have approved about 1,300 applications under the three facilities (Special Relief Facility, Agrofood Facility, Automation and Digitalisation Facility) of BNM’s Fund for SMEs, totalling RM682 million.

This is in addition to the other financing provided to SMEs by the banks under their own financing schemes where for the first two months of the year banks have disbursed RM42 billion of financing to SMEs.

The SMEs play a vital role in the Malaysian economy and are considered the backbone of the industrial development of the country. Being in the business of lending, our member banks are cognizant of the importance of business continuity for this segment and are ready to assist and provide access to financing for eligible SME borrowers. In light of the current Movement Control Order (MCO), our member banks are still processing loan applications, though remotely, and accordingly there may be longer processing times for loan applications.

SMEs can also get in touch with Credit Guarantee Corporation Malaysia Berhad (CGC) via their portal to explore the various financing initiatives they may offer for SMEs. imSME is Malaysia’s SME Financing/Loan Referral Platform, powered by CGC. The platform matches business financing needs of entrepreneurs and/or SMEs to suitable financing/loan offered by participating banks

  1. Credit Guarantee Corporation (CGC)
  2. imSME –CGC’s Online SME Financing/Loan Referral Platform

SMEs whose loan applications are not approved are advised to seek guidance and assistance from Khidmat Nasihat Pembiayaan (MyKNP). MyKNP is an initiative by BNM to assist individuals and SMEs on how to improve their eligibility for financing.

  1. Khidmat Nasihat Pembiayaan (MyKNP)

Such SMEs are also advised to consider alternative sources of funding for example the Malaysia Co-Investment Fund scheme (MyCIF) which is administered by the Securities Commission (SC). MyCIF offers funding via equity crowd funding (ECF) and/or peer-to-peer financing (P2P).

  1. Malaysia Co-Investment Fund scheme (MyCIF)
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