Budget 2022 includes RM40b ‘Semarak Niaga’ aid, zero-interest loans for businesses to recover from pandemic

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Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz announced a RM40 billion worth of financing package for entrepreneurs from small to big businesses for next year under the programme called Semarak Niaga Keluarga Malaysia. — Picture by Sayuti Zainudin
Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz announced a RM40 billion worth of financing package for entrepreneurs from small to big businesses for next year under the programme called Semarak Niaga Keluarga Malaysia. — Picture by Sayuti Zainudin

KUALA LUMPUR, Oct 29 — The government announced a multi-billion ringgit’s worth of aid to businesses in Malaysia on a road to recovery from the Covid-19 pandemic for Budget 2022.

Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz announced a RM40 billion worth of financing package for entrepreneurs from small to big businesses for next year under the programme called Semarak Niaga Keluarga Malaysia.

“These financing schemes include direct loans, financing guarantees and equity injections with the aim of benefiting every group of entrepreneurs regardless of micro-enterprises or public-listed companies,” he said during the tabling of Budget 2022 in parliament today.

Other than Semarak Niaga, Tengku Zafrul said additional financing worth RM1.8 billion will be provided through various agencies such as Tekun, Agrobank, BSN, Bank Rakyat and Bank Negara Malaysia.

“Thus, the Informal and Micro Financing Scheme under Tekun will offer loans of up to RM10,000 at an interest rate of 0 per cent with a moratorium for 12 months with priority given to informal and micro sector traders.

“Apart from that, BSN and Agrobank will also offer microloans of up to RM75 thousand at a rate of 0 per cent for the first six months with a moratorium facility of up to six months,” he said.

Tengku Zafrul also announced a specific initiative to help companies listed on the Exchange will also be introduced through additional funds by a government-owned SPV in the form of equity instruments or other related instruments to help companies that are viable but affected by the Covid-19 pandemic.

“For this purpose, Khazanah Nasional Berhad will be given the mandate to assist the government in providing the infrastructure to administer a fund of at least RM3 billion,” he said.

Meanwhile, for the Small and Medium Entreprises (SMEs) as well as encouraging crowd fundings and peer to peer financing which blossomed during the pandemic, Tengku Zafrul also announced an allocation of RM80 million in matching grants for Malaysia Co-investment Fund, in addition to the investment by BPMB of RM100 million.

In tandem with this, Tengku Zafrul also announced a funding method worth RM2.1 billion through equity and quasi-equity investments will be introduced to assist companies facing gearing or leverage problems.

“This method will be led by SME Bank in collaboration with Teraju and BSN with a fund of RM600 million and is open to all, especially Bumiputera entrepreneurs. In addition, BPMB will also offer a RESET Scheme (or Rehabilitation and Support Through Equity) and BNM will also provide a Business Recapitalisation Fund worth RM1 billion for the same purpose.

“In total, a total of RM14.2 billion of funds is available to SMEs,” he said.

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