Economic Development Programmes through SMEcorp

Munes, Jun, Premla, Denison, Meor & Mahdi at SMECorp (Feb 22, 2011)

SME Corp has come up with two very good products to support the business community.

• One targets the micro business people called E2 –Enrichment & Enhancement Programme which are micro enterprises (MEs) registered with the Registration of Business Act, with less than RM 250,00 annual sales turn over and with less than 5 workers

• The second targets SMEs which are bigger companies registered under the Companies Act (Sdn Bhd) with less that RM25 million annual sales and less than 150 workers in a programme called Business Accelerator Programme (BAP)

Visit to SMECorp

Yesterday Taskforce secretary Datuk Dr Denison Jayasooria together Taskforce officer Puan Premla Ravin visted SME Corp and met up with Mr Mahdi Mohd Ariffin, Deputy CEO and Mrs Muneswari Munusamy, Manager and Mr Meor Shahril, Asst Manager. Also present was Ms Junaidah Yusof, DFED, Bank Negara.

According to Dr Denison, he said it was a fruitful discussion and we learnt a lot concerning the SMECorp’s two new products. Once again we found out Indian community’s awareness on these are limited and there is very little coordinated effort to expose the community to many of these initiatives.

This visit has enabled the Taskforce to secure the basic information and details for further dissemination and also to ensure increased Indian participation. Taskforce will organize a meeting for leaders from Indian business associations and with their cooperation facilitate awareness programmes on the ground.

The Taskforce will give special emphasis to assist the informal and micro business players on the ground as a majority of the MEs are people at the bottom of the socio-economic ladder especially at the bottom 40%

Some interesting features of these programmes. There are 4 different aspects:-

• Feature 1 - DIAGNOSTICS

When a person applies on to their online registration and provides basic information a visit is made by an SMR Corp officer. An assessment is made to note strengthens and shortcomings. The evaluator will also draw up a plan of action for the business person to address the short falls in order to strengthen their competitiveness.

• Feature 2 – CAPACITY BUILDING

Based on the diagnostic tool used capacity building programmes will be recommended. SMEcorp has 40 approved training centres and the business person can enroll in any one of them. These can be skills based or awareness on branding.

• Feature 3 – ADVISORY & TECHNICAL SUPPORT

Two types of services provided. A One Referral Centre (ORC) provides advisory services for start ups and also established businesses. There is also an SME Expert Advisory Panel (SEAP) on various fields. This counseling, advisory and technical support is very useful and helpful in molding and grooming Indian business. These have to be utilized.

• Feature 4 – FACILITATING ACCESS TO FINANCING

SMEcorp provides both grants and soft loans. This aspect will be attractive. However the loans or grants are not automatic but based on Feature 1 –results of the diagnostic test.

For MEs soft loans and grants are available for below RM50, 000. Loans are at a 5% interest. For SME it is above RM50, 000 but below RM 500,000 at 4% interest rate. When a loan is approved then 40% of this could become a grant provided by the Federal government. The loans for MEs are administered by Bank Rakyat and the loans for SMEs by MIDF (Malaysian Industrial Development Finance)

Taskforce Role

The Taskforce will ensure that the information is disseminated and will call up the Indian business community at the micro –formal and informal together with the SME’s to plug into the system and take advantage of the programmes made available by the Federal government.