National SME Development Council 85 CHAPTER 1 The Malaysian Economy Chapter 6: 88 Diversified Financial Landscape for SMEs Box Article: Success Stories of the SME Assistance Guarantee Scheme 91 98 New Programmes and Financial Facilities in 2010 Box Article: New Financing Schemes Introduced in 2010 99
CHAPTER 1 86 National SME Development Council The Malaysian Economy
SME AR Layout Eng ok.qxd:layout 1 9/4/10 1:19 PM Page 87 Amidst the challenging business environment, early Government intervention helped to minimise the impact of the global financial crisis on local SMEs. Viable SMEs continued to have access to financing through various Government measures, including setting-up of new funds and guarantee schemes and initiatives to diversify avenues of financing. These measures accelerated the recovery process and thus essentially avoided an over-adjustment of the economy that could have otherwise occurred. Enhancing Access to Financing 87 National SME Development Council
88 National SME Development Council In 2008 and 2009, the Government had undertaken a comprehensive approach to assist businesses which include introducing stimulus measures specifically for SMEs amounting to RM15.6 billion or equivalent to 2% of GDP to weather the impact of the global financial crisis. Bulk of the measures was focused on enhancing access to financing for SMEs. As at end-june 2010, 80% of the funds have been approved, and 65% of these funds have been disbursed benefiting about 79,000 SMEs (end-2009: 53% disbursed to 56,000 SMEs) which helped support the early recovery of the economy. Diversified Financial Landscape for SME In addition to the comprehensive financial landscape comprising banking institutions (BIs), development financial institutions (DFIs), venture capital companies, leasing and factoring companies, there are also Government funds and Bank Negara Malaysia (BNM) schemes that SMEs can avail themselves. During the year, risk sharing mechanisms, such as the guarantee schemes were also introduced to enhance SMEs access to financing. Chart 6.1 Diversified Financial Landscape for SMEs Banking Institutions Development Financial Institutions BNM Special Funds and Guarantee Schemes Government Funds and Schemes Credit Guarantee Schemes SME Credit Bureau Government Crisis Funds Venture Capital Companies Leasing and Factoring Ar-Rahnu and Pawn Broking Microfinance Institutions Banking Institutions and Development Financial Institutions Banking institutions continued to remain as the main source of financing for SMEs, accounting for 80% of the total financing extended by the various SME financiers as at end-2009. In addition, DFIs complement the banks to facilitate the growth of strategic sectors as identified by the Government.
National SME Development Council 89 Chart 6.2 SME Financing Outstanding as at end-2009 (RM billion) Bls DFIs Government Funds and Schemes Venture Capital Leasing and Factoring 1.5 2.6 9.0 16.3 119.3 In 2009 and first-half of 2010, financing to some SMEs were excluded from the SME financing data because these companies had grown beyond the definition of SMEs. Without this exclusion, financing outstanding to SMEs by financial institutions expanded 5.5% year-on-year to RM146.4 billion involving 648,236 accounts as at end-2009, and increased further by 8% as at end-june 2010. Chart 6.3 Approval Rate of SMEs 0 20 40 60 80 100 120 Source: SME Corporation Malaysia, Bank Negara Malaysia and Securities Commission of Malaysia During the year, financing to SMEs via financial institutions, comprising the banking institutions and DFIs has remained strong. With the approval rate of 78% in 2009, the financial institutions had approved RM50.9 billion to 140,141 SME accounts. The approval rate rose further to 80% in the first-half of 2010. The six DFIs under the purview of BNM had approved a total of RM5.6 billion financing to 27,144 SME accounts throughout the 683 branch networks. Total financing outstanding from DFIs grew from RM14.1 billion as at end-2008 to RM16.3 billion as at end-2009, representing an increase of 15.4% and reaching out to 112,288 SME accounts. % 100 80 60 40 The comprehensive and holistic approach in enhancing access to financing for SMEs has raised Malaysia s global ranking in terms of financial access as follows: Number 1 for the third consecutive year by the World Bank on Getting Credit (Doing Business 2008, 2009, 2010); Number 5 by Consultative Group to Assist the Poor (CGAP) for Loan accounts per 1,000 adults (Financial Access Report 2009); and Number 13 in 2009 (up from number 15 in 2008) by the World Economic Forum for Ease of Access to Loans (Global Competitiveness Reports 2008-2009 and 2009-2010) 20 0 2006 2007 2008 2009 2010 1H All customers Source: Bank Negara Malaysia SMEs
90 National SME Development Council Special Guarantee Schemes Among the most effective measures introduced during the period were the guarantee schemes. SME Assistance Guarantee Scheme (SME AGS RM2 billion): BNM established the scheme in February 2009 to assist viable SMEs, which were adversely impacted by the global crisis, to continue to have access to financing from the financial institutions and at a reasonable cost. The take-up rate was overwhelming as the allocation was fully utilised by December 2009, benefiting 9,298 SMEs in various sectors. Eligible SMEs could obtain financing of up to RM500,000 per company with the support of 80% guarantee cover provided by Credit Guarantee Corporation Malaysia Berhad (CGC) at no cost. Working Capital Guarantee Scheme (WCGS RM7 billion): The Financing Guarantee Scheme was introduced together with the Industry Restructuring Scheme in March 2009 as part of the second stimulus package. The schemes were administered through a Governmentowned special purpose vehicle, Syarikat Jaminan Pembiayaan Perniagaan Berhad (SJPP), a company managed by Prokhas Sdn Bhd (Prokhas). The WCGS which was aimed at providing working capital to companies with shareholders equity of below RM20 million provided up to a maximum loan amount of RM10 million and repayment period of up to five years. The Government guaranteed 80% of the financing, while the remaining 20% is by financial institutions. Due to the overwhelming response, the Government allocated an additional RM2 billion from the RM5 billion Industry Restructuring Financing Guarantee Scheme to WCGS to total RM7 billion. The WCGS which was closed for new applications as of October 2009 has benefited some 5,300 companies with a total of RM5.9 billion in loans disbursed as at 1 July 2010. Under the Tenth Malaysia Plan (10MP), the Government has increased an additional allocation of RM3 billion to the WCGS, which will be effective as of 1 January 2011. Industry Restructuring Financing Guarantee Scheme (IRFGS RM3 billion): The IRFGS was to enable SMEs to retool their activity to move up the value chain and to encourage usage of green technology. Under IRFGS, the Government provides guarantee ranging from 50% to 80% on the financing facility granted by the participating financial institution, depending on the size of the shareholders funds of a company. The IRFGS will remain open until end-2010 or until fully utilised before that. The maximum loan amount for the IRFGS is RM50 million to be repaid within a period of 10 years. As at 1 July 2010, 228 companies have benefited with RM945.6 million worth of loans approved. Credit Guarantee by Credit Guarantee Corporation (CGC) CGC continued to provide credit guarantees to SMEs despite the weak economic environment. This was basically to assist viable SMEs to sustain or expand their businesses and help spur economic activities in the country. In 2009, CGC guaranteed more than 14,000 loans (2008:10,368) to all sectors of the economy valued at RM3.1 billion, a significant achievement in a tough year. CGC also managed the shariahcompliant Bumiputera Entrepreneur Project Fund (Tabung Projek Usahawan Bumiputera-Islam (TPUB-i)), with a fund allocation of RM300 million. The TPUB-i, originally managed by ERF Sdn. Bhd., provides financing to Bumiputera contractors who have been awarded projects by the Government or Government- Linked Companies and Agencies. As at end-2009, CGC had approved loans valued at RM12.6 million to 24 Bumiputera contractors. CGC s guarantees enabled viable SMEs without or with minimal collateral and no track record to gain access to financing from the financial institutions. As at end-december 2009, CGC had cumulatively guaranteed more than 402,000 loans valued at RM45 billion. Currently, it manages 12 guarantee schemes including the Green Technology Financing Scheme launched in January 2010.
National SME Development Council Success Stories of the SME Assistance Guarantee Scheme Freeform Sdn Bhd client of Alliance Bank Star Forte Sdn Bhd client of AMBank 91 Freeform Sdn. Bhd. was founded in 1998 by Mr. Yap Jee Pun. The company began publishing magazines as its core business and gradually over the years ventured into advertising, media and event consultancy. Its magazines like KLue and Junk which are now available at the various bookstores and newsstands are published every fortnightly. During the recent global financial crisis, the company needed additional cash flow to sustain its operations. However the company was unable to provide collateral to secure the credit facilities. Mr. Yap approached Alliance Bank for financial advice and assistance. The bank manager evaluated his request and proposed the SME Assistance Guarantee Scheme (SME AGS) as a financial solution for his company. Thereafter the company applied for the facility and was approved. Mr. Yap is appreciative of the initiative by the Government especially during difficult periods of the global financial crisis. Mr. Yap commended, SME AGS is a good scheme for SME customers as it enables them to sustain and grow the business. Star Forte Sdn Bhd (SFSB) was incorporated in 2006 and primarily involved in the supply of corporate gifts and souvenirs. Its customers are from various sectors and one of its major clients is Malaysia s famous low cost airline company, Air Asia. In line with expansion plan as well as expected increase in working capital requirement, SFSB has approached AmBank for the SME Assistance Guarantee Scheme (SME AGS). The management of SFSB was delighted by the fast turnaround time offered by both AmBank and Credit Guarantee Corporation Berhad (CGC). The management of SFSB also realised that the Base Lending Rate was at record low of 5.55% and therefore an opportune time to get additional working capital funding, particularly during the economic downturn then. As a result of the funding from SME AGS, SFSB s cash flow position has improved significantly. Overall, the business operation of the company has improved, as it was able to negotiate better terms with suppliers while expanding its clientele base.
92 National SME Development Council NL Logistics SDN BHD client of SME Bank NL Logistics Sdn. Bhd. is a transportation company that provides services to Government agencies and private companies. In view of its expanding business and increasing number of contracts secured from various agencies, the company needed additional working capital. Nevertheless, the company s director Puan Suhaida binti Sarijan explained that it was rather challenging for her company to secure loans from financial institutions that imposed high collateral. She added, The introduction of the SME AGS, however, has enabled the company to apply for a loan from SME Bank without any collateral. The RM500,000 loan that we received has allowed the company to undertake various new projects to support the rising cost of operations. Teraju Hikmat Sdn Bhd client of RHB Bank As a general contractor engaged in infrastructure, building and plumbing works, Teraju Hikmat Sdn Bhd has been directly affected by the increase in the price of building materials during the global financial crisis in 2009. At that particular time, although the company had secured two projects worth RM6.08 million, it faced cash flow problems and was not able to purchase sufficient building materials for the projects. To address its cash flow problem, the company turned to SME AGS and received a five-year term loan worth RM350,000 in August 2009. I am so grateful for the assistance offered by SME AGS and was further amazed at the speed in which the loan was approved. Disbursement of the funds was timely and this allowed the company to purchase sufficient building materials required for the projects that we had in hand, said the company s director, En. Dzain bin Junat @ Abu Bakar. Feature Tour Sdn Bhd client of Standard Chartered Bank Feature Tour Sdn. Bhd., a travel agency, faced cash flow problems during the crisis period in 2009. The inception of SME AGS was timely for the company director, Mr. Quah, who found that the loan application process was straightforward and hassle-free. The company has never taken any loans before and the fact that no collateral is needed to secure the loan suited the company well. The whole process was simple and straightforward; the documents required for the loan application were reasonable. The bank s representative was also very efficient and explained the terms and conditions well, Mr. Quah quipped. The fund has eased the company's overall cash flow in times of difficulties and ensured the continuity of the business.
National SME Development Council 93 SME Credit Bureau The SME Credit Bureau was established by CGC in July 2008 to assist SMEs to build, maintain and enhance their credit standing, and ultimately facilitate wider and easier access to financing. The Bureau is the leading provider of comprehensive and credible credit information and ratings on SMEs in Malaysia. It is: A convenient one-stop centre for financiers and other credit grantors to retrieve credit information and ratings on SMEs for credit evaluation purposes; and A user friendly platform for SMEs to build their track record and credit standing to facilitate faster processing of their credit applications. As at end-june 2010, 38 financial institutions and 28,131 SMEs have become members of the Bureau. The Bureau currently provides credit reports such as the following: Self-enquiry Report which enables SMEs to be aware of their own credit standing and identify critical areas for improvement that will enhance their credit worthiness; Business Information Report which enables SME and Credit Grantor members to review their business partner's/customer's credit standing and ratings; and Business Review Report which provides trade information and probability of default of a company. The Bureau also provides Credit Monitoring Services, a cost effective mechanism to alert SMEs of the company s rating and any adverse changes to the company s information. Overseas Credit Guarantee Facility In supporting SMEs to undertake overseas projects, the total guarantee coverage approved under the EXIM Overseas Guarantee Facility (EOGF) of the Export-Import Bank of Malaysia Berhad (EXIM Bank) stood at RM256.8 million as at end-2009. Under the scheme, the Bank provides up to 80% guarantee to financing extended by participating financial institutions to eligible companies undertaking projects overseas. In view of the global economic crisis, the EOGF terms and conditions were also changed in May 2009 to include the participation of locallyincorporated foreign banks, and the loan extended to public-listed companies, as well as their subsidiaries. As at end-june 2010, 18 SMEs benefited from the guarantee facility. Microfinance Micro entrepreneurs have access to financing via Pembiayaan Mikro based on the financing framework approved by the National SME Development Council which requires no collateral, minimal documentation and fast approval. Currently, there are nine participating financial institutions of Pembiayaan Mikro comprising six banking institutions and three DFIs. The number of access points (including branches of participating financial institutions and strategic partners) for Pembiayaan Mikro has increased from 913 as at end-2006 to 1,868 as at end-2009. Under Pembiayaan Mikro, financing outstanding grew by 28.1% year-on-year to RM709.3 million, while the number of Pembiayaan Mikro clients grew by 20.8% year-on-year to 62,798 as at end-june 2010 (end-2009: RM616.5 million, 57,403 clients). In addition, the Government also introduced other new microfinance schemes during the global financial crisis. BNM established the RM200 million Micro Enterprise Fund (MEF) in November 2008 to further enhance access to financing for micro enterprises. The fund is accessible through the participating financial institutions of MEF. As at end-june 2010, RM131.8 million of financing has been approved to 5,945 micro enterprises via this scheme (end- 2009: RM79.6 million to 3,646 micro enterprises);
SME AR Layout Eng ok.qxd:layout 1 9/4/10 1:20 PM Page 94 94 National SME Development Council Venture Capital Outstanding investments by Venture Capitals (VCs) increased by 34% year-on-year from the RM1.9 billion invested as at end-2008 to RM2.6 billion as at end-2009, based on the Securities Commission Malaysia Report 2009. In 2009, RM597 million were invested in 99 investee companies, resulting to a total of 445 investee companies as at end2009 (2008: RM477 million, 134 investee companies). The total committed funds for venture capital investment had grown 17% year-on-year to RM5.4 billion as at 31 December 2009, compared to RM4.6 billion in 2008 largely due to higher contribution by Government Agencies amounting to RM2.8 billion in 2009. Agrobank was given an additional allocation of RM300 million under the Second Economic Stimulus Package to assist mainly farmers, small enterprises and petty traders. In particular, retrenched workers during the economic downturn was given an opportunity to venture into business particularly in the agriculture and resource-based activities. As at end-june 2010, 14,929 companies have benefited from RM287.8 million in loans disbursed. The microcredit facility called Micro ESP-i (Pinjaman Mikro ESP-i) is collateral-andguarantor-free financing with maximum amount and tenure of up to RM50,000 and five years, respectively; Tabung Ekonomi Kumpulan Usaha Niaga (TEKUN) was given an allocation of RM50 million under the Second Economic Stimulus Package to assist small entrepreneurs. The popular fund was fully disbursed in 2009 and had benefited 5,032 entrepreneurs; and Amanah Ikhtiar Malaysia (a nongovernmental organisation) was also been given an allocation of RM100 million to harness the potential of self-employment among the poor households and low-income in the urban areas. As at end-june 2010, 32,274 poor had benefited from RM102.5 million funds disbursed. There was a discerning trend towards investments in new growth areas, where 25.2% of total investments were made in life sciences subsectors (2008: 18%), 18.7% in the manufacturing sector (2008: 27.4%), 17.4% in the ICT (2008: 18.5%) and 38.7% in other sectors such as education, electicity and power generation and logistics (2008: 36.1%). In terms of life-cycle of the investee companies, 53% of the RM597.3 million was invested in 49 investee companies at the expansion/ growth stage, while 21.1% were for investee companies at the early and start-up stage. Total amount invested in companies at the seed stage continued to be comparatively small, representing only 3% of total investments made in 2009.
National SME Development Council 95 Government Funds and Schemes As at end-2009, a total of 1.9 million SMEs had benefited from RM52.2 billion funds approved from 85 Government funds and schemes. These funds include 79 funds which were rationalised in 2009 to 33 schemes (14 grants and 19 soft loans) by a Special Committee led by the Economic Planning Unit (EPU) to enhance the effective implementation of Government funds. Table 6.1: Performance of Government Funds and Schemes as at end-december 2009 No. of Schemes Allocations Applications Approved Disbursed Outstanding RM Billion No. RM Billion RM Billion RM Billion Soft loans 47 28.08 1,815,426 44.01 67.41 15.74 Grants* 17 4.26 61,539 3.96 2.69 0.15 Guarantee Schemes Venture Capital 7 3.08 31,890 2.77 1.38 0.06 12 1.29 85 0.70 0.63 0.11 Equity 2 0.39 140 0.71 0.56 0.36 Total 85 37.10 1,909,080 52.15 72.67 16.42 *In this category, it includes venture capital funds Source: SME Corporation Malaysia The key funds and grants include: Grants approved by SME Corporation Malaysia (SME Corp. Malaysia) to 4,270 projects amounting to RM143.3 million in 2009 (2008: 4,019 approvals) Soft loan schemes by SME Corp. Malaysia through Malaysian Industrial Development Finance Berhad (MIDF) were consolidated into one scheme, namely the Soft Loan Scheme for SMEs (SLSME). In 2009, MIDF approved 138 soft loan applications amounting to RM102.2 million, compared with 268 approvals valued at RM234.2 million in 2008. Perbadanan Usahawan Nasional Berhad (PUNB) continued to approve financing in 2009 amounting to RM141.15 million under four schemes to assist 372 Bumiputera entrepreneurs in distributive trade and SME sectors. The four schemes are: SME scheme for manufacturing, engineering and selected services sectors; Pemborong PROSPER for the wholesale sector; PROSPER Runcit for the retail sector; and
96 National SME Development Council PROSPER Siswazah for development of young Bumiputera graduates venturing into retail and distributive trade businesses. In addition, under the PROSPER Property, PUNB acquired 50 business premises at strategic locations worth RM50.90 million to be leased out to potential Bumiputera entrepreneurs. Five SME special funds under BNM which are channelled through participating financial institutions have assisted more than 44,000 SMEs with total financing approvals of RM19.3 billion as at end-june 2010 (end-2009: RM18.4 billion). Table 6.2 Special Funds and Guarantee Schemes for SMEs Administered by BNM 1 Special Funds Allocations Approvals Disbursements RM Million % As at end-june 2010 Loans Outstanding Utilisation Rate 2/ Fund For Food 1,300.0 1,727.9 1,707.2 154.0 61 New Entrepreneurs Fund 2 Fund for Small and Medium Industries 2 2,850.0 3,829.4 3,569.0 2,024.1 87 6,750.0 13,643.4 12,583.6 5,118.8 96 Micro Enterprise Fund 200.0 131.3 121.4 110.5 62 Bumiputera Entrepreneurs Project Fund - Islamic 300.0 36.6 13.1 10.4 12.2 Total 11,400.0 19,368.6 17,994.3 7,417.8 87.6 Financial Assistance and Guarantee Schemes SME Assistance Guarantee Scheme (as at 11 July 2010) 2,000 2,000 1,770.1 1,530.4 100 1/ All funds are revolving except the Bumiputera Entrepreneurs Project Fund - Islamic 2/ Ratio of approvals over allocations and repayments Source: Bank Negara Malaysia
National SME Development Council 97 Small Debt Resolution Scheme (SDRS) In addition to the various facilities available for early stage financing and for expansion, there is also a scheme to assist SMEs that get into financial difficulties. Recognising the more challenging environment that SMEs are operating in, BNM enhanced the eligibility criteria of the Small Debt Resolution Scheme (SDRS) in May 2009. Viable SMEs with nonperforming loans (NPLs) or nonperforming financing (NPF), irrespective of amount, and viable SMEs facing financial difficulties with financing from multiple financial institutions are eligible to apply for the SDRS. As at end-june 2010, 705 applications with loans amounting to RM533 million (or 71% of applications received) have been approved for rescheduling or restructuring under the SDRS (end-2009: 684 applications, RM471 million). In addition, financial institutions have also proactively restructured and rescheduled financing facilities of viable SMEs, where cases have increased in 2008 to 3,235 (2007: 1,537 cases) and in 2009 to 4,646 cases totalling RM3.2 billion due to the global crisis. Financial Advisory Services The Government and the commercial banks have established advisory services for individuals to seek information and assistance on credit issues. During the year, BNM enhanced its Integrated Contact Centre (ICC) comprising BNMLINK and BNMTELELINK that includes the Complaints Management and Advisory Unit. BNM successfully resolved 92% of 531 cases related to access to financing by SMEs in 2009, of which 49% were resolved in favour of SMEs following the Central Bank s facilitation and intervention. Contact Details: Tel: 1300 88 5465 (Toll-Free Line) Fax: 03-2174 1515 / 03-2174 1616 E-mail: bnmtelelink@bnm.gov.my In December 2008, the ABMConnect Toll Free at 1300 88 9980 was also set up by the Association of Banks in Malaysia (ABM), which represented the collaboration among banking institutions to serve as a ready platform for general enquiries relating to banking and credit issues. This is in addition to SME complaint units and SME special units established at financial institutions including SME Bank and CGC to handle consumer enquiries and grievances. Contact Details: ABMConnect Call Toll-Free 1-300-88-9980 E-mail: eabmconnect www.abm.org.my/abmconnect In addition, SMEs could also seek assistance from the One Referral Centre at SME Corp. Malaysia including its state office nationwide. Business coaches and counselors have been able to provide the various business advisory services in addition to providing information on Government funds, programmes and incentives available for SMEs. Contact Details: Tel: 603-6207 6000 Fax: 603-6201 6564 E-mail: info@smecorp.gov.my Infoline: 1-300-88-1801 www.smecorp.gov.my www.smeinfo.com.my
98 National SME Development Council New Programmes and Financial Facilities in 2010 The Government has allocated a total of RM5.9 billion for 39 programmes to be implemented in 2010 to further enhance access to financing for SMEs for working capital and business expansion locally and globally, as well as to assist SMEs at the start-up and early stage. There have been seven new schemes established in 2010 to assist SMEs, particularly in the services and agriculture sectors, as well as to promote entrepreneurship among micro enterprises and school leavers. Table 6.3 New programmes in 2010 Ministry/Agency Programmes (RM million) JPM - FELDA Skim Insentif Usahawan Felda (SIUF) 10 MOF MOF MID Sabah MID Sabah MID Sabah MID Sabah Creative Industry (Bank Simpanan Nasional) Ar-Rahnu Micro Programme (Yayasan Pembangunan Ekonomi Islam Malaysia) Sabah Bumiputera Entrepreneur Financing Scheme (SPUBS) Sabah Women Entrepreneur Financing Scheme SME Machine and Machinery Purchase Aid Scheme Financing Scheme for Technical School Leavers and Workshop Owners 50 148 2.8 3.4 1.2 2.2 Total 217.6 Source: SME Integrated Plan of Action 2009, SME Corporation Malaysia The new and early start-up companies may avail to various specific schemes, such as: Skim Belia Tani-i/Skim Belia Niaga (Agrobank); Initiative Financing Scheme (AIM); PUNB SME Scheme (for manufacturing and services sector) and PUNB PROSPER Schemes (for retail and distributive trade sector); Financing Scheme for Technical School Leavers and Workshop Owners (SEDCO Sabah); and Financing Scheme for SMEs to Purchase Machines and Equipment (SEDCO Sabah). During the year, Government grants will be continuously rationalised in a move to enhance its effectiveness, with the intention to be gradually phased out and replaced with soft loans or reward-based schemes. The more sustainable financing schemes would promote good credit culture and enhance financial discipline among SMEs as well as to expand its utilisation to more SMEs besides preparing the borrowers to move towards a market based scheme in future. As a Central Coordinating Agency, SME Corp. Malaysia is also tasked to ensure that financial assistance schemes by all relevant Ministries and Government Agencies across all economic sectors are monitored for its effectiveness in facilitating SMEs to progress up the value chain. SME Corp. Malaysia also promotes financial inclusion for SMEs especially microenterprises. In this context, the expected outcome of the various financing schemes will be monitored in the following areas:
National SME Development Council 99 Non-performing loans; Viability of SMEs after two years from receiving the financial assistance; Business improvement in terms of turnover and profitability growth; Increase in number of rural entrepreneurs with higher monthly income; and Increase in number of entrepreneurs developed. New Financing Schemes Introduced in 2010 In addition, SME Corp. Malaysia will assess and ensure SMEs in the new growth areas have adequate accessibility to financing, at a reasonable cost. These initiatives are in line with the Government s vision to integrate SMEs into the New Economic Model (NEM) that will primarily be based on innovation, creativity and high value-added services, as well as human capital development. The Creative Industry Fund (CIF) amounting to RM200 million announced during the 2010 Budget is administered by Bank Simpanan Nasional (BSN). The Scheme is to finance activities such as film and drama productions, music, animation, advertisements and local content development, with the intention of boosting commercial activities in the local creative industry. Eligible SMEs will be extended credit facility ranging from RM50,000 to RM5 million at competitive interest rates of between 2% to 4% for a duration of up to five years. The Government announced the RM1.5 billion Green Technology Financing Scheme (GTFS) during the Budget 2010 speech in October 2009 to promote investments in Green Technology. The Government provides a guarantee of 60% on the financing amount via the Credit Guarantee Corporation Berhad (CGC), while the remaining 40% financing risk is borne by the participating financial institutions. The Scheme came into effect on 1 January 2010 for a period of three years or until the Scheme limit of RM1.5 billion is reached. Malaysia Green Technology Corporation (formerly known as Pusat Tenaga Malaysia) has been tasked to conduct technical audits on applicants of the scheme which include green technology providers as well as users of green technology, to ascertain eligibility. Applicants who are eligible will be awarded a Green Technology certificate, which will then entitle them to apply for financing under the GTFS. As at 9 July 2010, 33 projects have been awarded the Green Technology certification, with potential financing amounting to RM957 million. Four projects have been granted financing under GTFS, with total financing amount of RM108.3 million.