LABUAN:  A total of RM3.3 billion in funding is still available under the Bank Negara Malaysia's (BNM) Funds for small and medium enterprises (SMEs) for working capital and the purchase of machinery.

BNM Development Finance and Enterprise Department Director Marina Kahar said local SMEs, including start-ups, should leverage the fund to finance and lower their cost of doing business.

She said the funding could be applied through commercial and Islamic banks, development financial institutions and Credit Guarantee Corp Malaysia Bhd.

A lack of awareness about such funds and grants provided by government agencies and financial institutions is one of the main reasons why they are not fully utilised, she told a media briefing here on Tuesday.

She said the largest source of financing to SMEs at 97 per cent came from financial institutions which provided consolidated funds.

The service sector topped the list of recipients of funding at 63 per cent, followed by manufacturing (15 per cent), construction (12 per cent), agriculture (six per cent) and other sectors (four per cent).

The BNM SME Fund, a revolving fund that is convenient and affordable for SMEs, was introduced in the late 1990s with a total allocation of RM10.4 billion.
Of the total, Marina said RM7.1 billion has been utilised, benefiting more than 76,000 SMEs.

She said financial institutions had simplified the application process for approval of the SME Fund within two weeks from 70 days previously.

“To ensure SMEs are well-informed on the policy and procedures of the facilities, Bank Negara has initiated the Train-the-Trainers (TTT) programme to equip bank officers with skills to increase capabilities, awareness and knowledge of SMEs on financing matters and share the knowledge with SMEs,” she said.

She said RM286.7 million in financing was extended to SMEs that attended the TTT programme.

She said so far 26,125 bank officers had been mobilised nationwide and provided with specialised training to assist and advise SMEs on financing matters, while 17,043 of SMEs had been trained via 341 programmes.

Marina also disclosed that between 2008 and 2017, more than 17,000 or 97 per cent of distressed SMEs were assisted directly by financial institutions through restructuring and rescheduling, while three per cent or 477 were assisted under BNM's Small Debt Resolution Scheme.

SMEs must ensure that the financing is used for business purposes and make prompt repayment.

On the Disaster Relief Facility to assist SMEs affected by floods recently, she said the RM500 million fund allocated for the purpose is still available until May 31, 2018. - Bernama