Abang Jo: Interest-free loan of up to RM500,000 for SMEs

By Lian Cheng

KUCHING, Apr 10: Chief Minister Abang Johari has announced that RM1 billion will be allocated for an interest-free loan of up to RM500,000 for more than 40,000 small and medium enterprises (SMEs) in Stimulus Package 2.0.

The Sarawak government will absorb the interest rates which will amount to RM80.7 million over three-and-a-half years.

“In collaboration with Maybank, Hong Leong Bank and RHB Bank, under the Bank Negara Malaysia (BNM) Special Relief Fund (SRF), Sarawak Government agreed to absorb the interest costs due to be released to our SMEs.

“The interest-free loans of RM1.0 billion will be made available for our SMEs.

“The financial implication for the interest rates subsidy over the three-and-a-half years is RM80.7 million. The scheme will benefit more than 40,000 SMEs throughout Sarawak,” said Abang Johari at a press conference today.

He said SMEs need to apply for the loans directly from any branches of either Maybank, Hong Leong Bank or RHB Bank. All SMEs have an option to apply for either Islamic or conventional loans for the scheme.

Based on records, there are over 40,000 SMEs operating in Sarawak, he said and stressed that these SMEs are the backbone of Sarawak’s economy that provide job and business opportunities to Sarawakian.

Under this measure, all Sarawak registered SMEs must first comply with National SME Development Council (NSDC) SME definition where working capital must be in respect to salary payment.

The interest-free loan offered under the scheme involved the amount from RM20,000 to RM500,000 where no collateral is required.

SMEs of sole proprietorship, partnership and private companies are all entitled but these companies must be in operation for three years and more.

For SMEs who have been in operation for less than three years, they can still opt to apply for the RM50 million Micro Credit Scheme through Ministry of International Trade and Industry, Industrial Terminal and Entrepreneur Development Sarawak (MINTRED), which are part of the Covid-19 Sarawakku Sayang Stimulus Package Abang Johari announced on March 23, 2020.

To make SMEs better understand the interest free loan assistance provided, Abang Johari gave an example of a company with 10 staff.

For a company of 10 staff, and assuming that the average salary is RM3,000, the company may apply for a loan of RM180,000. (10 staff x RM3,000 x 6 months= RM180,000).

He said for such a case, the loan amount of RM180,000 will be released in full amount to the SME once the necessary documentation is completed.

“I hope this measure will ensure business resilience and job security for our people,” said Abang Johari. — DayakDaily