Small and Medium Enterprises (SMEs) are the lifeblood of Malaysia. They provide employment for millions of people all around the country. These smaller businesses are often the only source of employment in remote towns and villages towns that don’t have the populations to attract large businesses and factories. But trying to establish an SME can be an uphill battle. You may need an SME loan to get your business up and running.
Trying to get funding for an SME can be the biggest hurdle you face in your efforts in starting your business. The local population generally needs these businesses, but most of them don’t have the high-tech appeal that attracts private investors and venture capital firms.
Most financial institutions (FIs) require that you put up collateral to guarantee any funding. The truth of the old adage that you “have to have money to make money” becomes apparent once you start approaching Malaysian FIs for an SME loan.
Effects of COVID-19 on SMEs
As if it wasn’t hard enough to get a business off the ground already, the worldwide COVID-19 pandemic has required the implementation of a Movement Control Order (MCO) in Malaysia. This MCO, though necessary to ensure the health of the public, has catastrophic implications for SMEs that have established themselves, but are still struggling to become successful and profitable.
These businesses are in an extremely vulnerable position. They may have committed all the collateral at their disposal towards securing SME loans to start their businesses. Or, they may have self-funded their company initially, but now are facing ruin with the loss of business caused by the MCO.
They may have had to abandon their initial business plan and switch to a digital platform, isolate their employees, rethink their marketing strategies and take other drastic measures to adapt to the conditions imposed by the MCO. All these changes place more of a financial burden on a business that is new and struggling to establish a foothold in the marketplace.
SJPP offers Financial Solutions for SMEs
The Malaysian Minister of Finance recognises the vital role that SMEs fill in ensuring the ongoing stability and growth of the country’s economy during this critical time. They’ve established Syarikat Jaminan Pembiayaan Perniagaan Berhad (SJPP) as a solution to specifically address the financial needs of SMEs struggling to keep their head above water and survive.
SJPP has been set up as a guarantor of SME loans between enterprises and their FIs. These SME loan guarantees are available to any registered business falling under the classification of an SME. This includes start-ups, F&B enterprises, retail establishments, service providers and manufacturers.
Suppose you have a struggling SME that is in the process of expanding your services to meet demand or have sizable investments in equipment and materials that you’re trying to protect. In these cases, an SJPP SME loan scheme can be the lifeline you need to ensure the survival of your business.
Contact SJPP today to review all the different loan schemes and find the one that best suits your industry and type of business plan.