Bank Negara Malaysia (BNM) announced an additional injection of RM2.5 billion into the SME financing fund, following Prime Minister Datuk Seri Anwar Ibrahim's announcement in conjunction with the New Year.
The main focus of this fund is to help first-time borrowers.
According to BNM, to date, concessional funds for SMEs have reached RM32.4 billion through participating financial institutions. With this addition, the total now reaches RM34.9 billion.
BNM also announced a strategic shift to a credit guarantee scheme worth RM10 billion, which will be introduced together with Credit Guarantee Corporation Malaysia Bhd and other financial institutions. This scheme targets broader support, including for new entrepreneurs and first-time borrowers.
BNM's move seems positive, but the question is, will the injection of funds and this guarantee scheme be able to overcome the fundamental problems of SMEs such as tight access to credit and high risk?
Guarantee schemes are helpful, but without profound changes in the risk assessment and capabilities of financial institutions, these large funds may still not reach the hands of those who really need them.
