Halal Industry Fund for SMEs to improve halal products
PETALING JAYA: SME Bank has been one of the driving forces behind Malaysian small and medium enterprises (SMEs) to tap into the growing global appetite for halal products.
The global halal food and non-food market is estimated to be around US$2.1 trillion (RM6.55 trillion) annually, something that is attracting non-Muslims into the industry to supply it.
SME Bank recently announced another RM200 million under its Halal Industry Fund, that is available for SMEs to add value or improve their halal products.
It is creating this initiative in collaboration with strategic partners Islamic Development Bank, Malaysia External Trade Development Corp and Halal Industry Development Corp also under the Young Entrepreneur Fund (YEF) to assist youths aged 18-30 years to venture into entrepreneurship.
The fund is part of new incentives that are available for SMEs to spur growth under the government’s 2013 budget to add to the RM1 billion that has already been allocated to the SME Development Scheme to accelerate their growth and expand industrial estates.
SME Bank managing director Mohd Radzif Mohd Yunus said the bank has disbursed RM14.3 billion financing to help more than 8,700 SMEs. This works out to an average financing of RM2 billion approved for 1,200 SMEs annually.
“This programme is also in line with the SME Masterplan (2012-2020) which was launched to accelerate the growth of SMEs through innovation and productivity,” he said.
Mohd Radzif said the SME Bank has a programme called IQ-Dagang that turns creative ideas into bankable businesses.
“So far SME Bank together with partners like Malaysia Debt Ventures, Malaysia Technology Corp Sdn Bhd, Cradle Fund Sdn Bhd, Malaysia Biotechnology Sdn Bhd, UniKL and Technology Park Malaysia have already disbursed RM23.38 million to 20 companies. A total of 81 companies has been enrolled under this programme,” said Mohd Radzif.
The bank is also collaborating with other government agencies, development banks and regional economic schemes.
The SME Development Scheme (SDS) and YEF were launched recently and shows the bank’s commitment to providing continued support to SMEs, part of the developmental role mandated by the government.
The SME Development Scheme is targeted at assisting SMEs in growth and development stages, primarily focusing on SMEs under National Key Economic Areas (NKEA) and other government promoted sectors.
“This scheme is open to viable Malaysian-owned businesses to finance asset expansion and working capital,” said Mohd Radzif.
The YEF is a special fund allocated by the government as part of its continuous strategy to inculcate and support new entrepreneurs among Malaysian youth. The purpose of this fund is to provide opportunities to young entrepreneurs to venture into new business and to support existing businesses with a minimum financing of RM50,000 and maximum financing of RM100,000.
SME Bank announced recently that they hope to finish disbursing the RM50 million allocation from the government for the YEF by September to 700 recipients nationwide.
Vice-president and head of priority banking Abd Karim Ahmad said that it had received 42 applications for the scheme and would disburse RM5 million to them and that by April, the bank has targeted to receive another 100 applications for the YEF and it would disburse RM15 million to the young entrepreneurs.
With the YEF and SDS, there should be no need for young entrepreneurs and SMEs to get loans from unlicensed money lenders. There are many government-initiated schemes which SMEs should take advantage of, for their own benefit.
The government is now becoming more proactive, and unlike before, it is now less of a hassle for SMEs to get loans.
To ensure the entrepreneurs are sustainable for the longer term, the element of capability building among SMEs is vital. Therefore, in this regard, SME Bank has established a Centre of Entrepreneur Development and Research which aims to provide advisory and consultation for SMEs.