Recognising the environment that remains challenging for some borrowers, Bank Negara Malaysia and the Malaysian financial industry are committed to assist individuals and viable businesses adversely affected by the COVID-19 pandemic, to support economic recovery and safeguard the livelihood of Malaysians.
Bank Negara Malaysia has established additional or enhanced existing financing facilities to provide relief for, and to support the recovery of SMEs.
The RM4 billion facility is for affected SMEs in the services sector. Offered at a rate of up to 3.5%, TRRF will be available through participating financial institutions, with guarantee coverage by Credit Guarantee Corporation (CGC) or Syarikat Jaminan Pembiayaan Perniagaan (SJPP).
The facility is now available until 31 December 2021 or full utilisation (whichever is earlier).
The RM1 billion facility is aimed at supporting high-tech and innovation-driven SMEs affected by COVID-19 to recover and revitalise the nation’s innovation capacity. Financing rate of up to 3.5% per annum is offered for financing without guarantee or up to 5% per annum inclusive of guarantee fee (with guarantee coverage by Credit Guarantee Corporation Malaysia Berhad (CGC).
The facility is available now until 31 December 2021 or full utilisation (whichever is earlier).
The RM1 billion facility is aimed at incentivising SMEs to automate processes and digitalise operations to improve productivity and efficiency. The financing rate is up to 4% per annum, inclusive of guarantee fee. Guarantee coverage is provided by Syarikat Jaminan Pembiayaan Perniagaan (SJPP).
The facility will be available until 31 December 2021 or full utilisation, whichever is earlier.
This facility will be increased from RM300 million to RM410 million to support microenterprises including gig workers on digital platforms and the self-employed. The facility is for working capital and capital expenditure.
BNM has allocated billions of ringgit in specific purpose funds to help SMEs sustain business operations, safeguard jobs and encourage domestic investments. Features & qualifying requirements for the available funds are as follows:
Besides BNM's Fund for SMEs, there are also other Suite of Financing Assistance available for SMEs
For those who have lost their jobs, and for individuals and SMEs whose incomes have been affected by the pandemic, all banks continue to stand ready to provide support to borrowers that need assistance.
Borrowers should continue to approach their banks for tailored repayment assistance based on their specific financial circumstances.
Details are available in the Targeted Repayment Assistance (TRA) microsite
Additionally, the Government, BNM, and the financial industry are collaborating on several initiatives to further assist individuals and SMEs. Further details of all of these measures will be issued by the respective banking and insurance associations soon. Members of the public can contact BNMTELELINK at bnmtelelink@bnm.gov.my for further information.
The iTEKAD programme, which was launched in May 2020, combines social finance instruments such as zakat, sadaqah and waqf with the provision of microfinancing, structured training and mentorship. These instruments will empower micro-entrepreneurs from the B40 segment to generate sustainable income and achieve financial resilience.
In tandem with the increase in allocation to MEF, the iTEKAD programme will be expanded with the participation of more Islamic banks. This will be done in collaboration with a wider network of states and implementation partners, will be participating in the iTEKAD programme in 2021.
Financial assistance will be provided by the Government for the B40 segment in the form of vouchers to purchase insurance and takaful coverage under the Perlindungan Tenang scheme from licensed insurers and takaful operators. The financial assistance of RM50 voucher will be given to eligible B40 recipients to help them purchase Perlindungan Tenang products starting 1 April 2021.
Perlindungan Tenang products are products approved by BNM to meet the needs of under-served market segments. The products must satisfy stringent criteria on affordability and customer value, with minimal exclusions to ease claims and ensure meaningful protections, particularly for lower income groups. The products include protection for life takaful and personal accident.
For more information on Perlindungan Tenang products and to obtain a list of participating providers, the public can refer to
The Small Debt Resolution Scheme (SDRS) function has been transferred to AKPK from 1 September 2020. This will help SMEs including micro SMEs have better access to debt resolution schemes, to help them manage their finances.
Lower OPR translates to lower interest/profit rates on loans/financing by banks. This should help to reduce the monthly loan obligations for businesses and households.
The Special Relief Facility (SRF) was designed to help alleviate the short-term cash flow problems faced by SMEs adversely affected by the COVID-19 outbreak. This fund is not available for application.
The Government has created a dedicated fund for businesses in the tourism sector still affected by the pandemic under the PENJANA initiative. Applications for the fund is now open.
The Government has announced a 6-month moratorium for loan/financing repayments from 1 April 2020. This should help relieve the monthly burden of individuals and businesses whose income have been affected by the pandemic.
The moratorium is a temporary relief measure that allows for deferment of loan repayments but that will lead to higher repayment amounts. Loan R&R may reduce the monthly obligation by extending the loan repayment schedule or changing its terms.
Borrowers need to reach out to their banks to work this out, and not wait until the end of the moratorium period.
Measures include deferment on life insurance premiums/family takaful contributions, flexibilities to preserve/reinstate policies, flexibilities to meet general insurance premiums/takaful contributions, and expedited claims processing until 31 Dec 2020.
The SAC's ruling covers the financing contract, conversion between conventional loan and Islamic financing, and on the compounding profit.
The Association of Banks in Malaysia (ABM), Association of Islamic Banks in Malaysia (AIBIM), and Association of Development Financial Institutions of Malaysia (ADFIM) are working together with BNM to assist borrowers affected by the pandemic.
Life Insurance Association of Malaysia (LIAM), Persatuan Insurans Am Malaysia (PIAM), and Malaysian Takaful Association (MTA) have jointly established the COVID-19 Test Fund to assist Health Ministry to conduct more testing for policyholders
Borrowers should not wait until the end of the moratorium to contact their banks to get help. Plan and act now to get the most benefit.
These are collection of short videos excerpted from the webinars BNM has conducted
