Shariah Compliant SME Financing Scheme (SSFS) 2.0 For Malaysia SME
Shariah Compliant SME Financing Scheme (SSFS) 2.0: Everything About the Financing Scheme For SMEs in Malaysia
Among the financing schemes for SMEs in Malaysia is the Shariah Compliant Financing Scheme, a government based funding for viable businesses. A program helping Micro, Small and Medium based Enterprises the Shariah Compliant SME Financing Scheme (SSFS) 2.0 provides financing to the SMEs, where the government has agreed to pay 2% of the profit rate, with the amount depending on the size of business. In the program, government allocated RM1 billion for 1/1/2016 until 31/12/ 2017, meaning that the government will finance the companies under this threshold. Besides, the government provides the fund on a first come-first serve basis. The maximum amount allocated for a specific SME is RM5 million.
This is a Syariah- compliant financing scheme, and the financing can be used in the following activities:
- Working Capital
- Assets and Equipment’s
- Upgrading and Innovating the Business.
Companies should fulfill the following criteria:
- The company should be Malaysia incorporated and satisfy the definition of SME.
- The company should not have received any prior rebate assistance under the RMK-10 SSFS fund @ RM 2billion.
- There should be at least 60% Malaysian ownership.
- One or more of these conditions should be fulfilled during the application.
- At least two stars under SCORE.
- In case it is a microenterprise, it should be rated with Level 1 under MCORE.
- 1-InnoCERT certification.
- National Mark of Malaysian Brand Certification.
- MSC status by MDeC.
- Bio-Nexus status company under Malaysian Biotechnology Corporation
- Green Tech Cert Certification by Malaysian Green Technology Corporation
- TeaS selected SME under TERAJU.
Note: more of these conditions fulfilled, more the chance of your company is approved.
If you do not fulfill these conditions, but still government approve the SME, you should apply for the SCORE. Or MCORE within two months from the financing approval date.
Every Syariah-compliant SMEs are eligible to apply. Yet, those with financial product or services which are currently under banking, insurance, or other laws’ regulations are not eligible.
“Shareholding by the government’s side is also eligible.
SMEs under Syariah-compliant microfinancing.
Anyway, these shareholdings are not applicable.”
- Government-linked corporations (GLC)
- Public listed companies (PLC)
- Multinational Corporations (MNC)
First, you will have to gather your documents, certifications and financial transaction records and approach any of these participating financial institutions.
- Affin Islamic Bank Berhad
- Alliance Islamic Bank Bhd
- AmIslamic Bank Berhad
- Bank Islam Malaysia Berhad
- Hong Leong Islamic Bank Berhad
- Bank Muamalat Malaysia Berhad
- CIMB Islamic Bank Berhad
- Bank Kerjasama Rakyat Malaysia Berhad
- Public Islamic Bank Berhad
- RHB Islamic Bank Berhad
- HSBC Amanah Malaysia Berhad
- Maybank Islamic Berhad
- Agro Bank
- Al-Rajhi Bank
Then, you will need to fill an application form and sit for an interview in case the financing is still available. You will be enquired about your business plans and proposal, and your application will be reviewed before being approved. Before getting the funds, you will need to sign an agreement letter, where you agree that you meet with the requirements and the participating financing institution can disclose your financial information to SME Corp. Malaysia and Ministry of Finance.