By Farah Adilla – March 30, 2022 @ 10:04am
KUALA LUMPUR: Beyond bank financing, alternative sources of financing and financial instruments are key to support the growth of innovative firms and promote longer-term financial stability, Bank Negara Malaysia said.
Bank Negara, in its 2021 Annual Report however, said Malaysia’s alternative finance ecosystem was still underdeveloped compared to other countries.
It said efforts and broad strategies were required to develop a wider range of funding instruments to better meet the diverse funding needs of small and medium enterprises (SMEs) across the business lifecycle.
“Going forward following the Financial Sector Blueprint 2022-2026, sustaining and growing the alternative finance ecosystem is one of the strategies that the bank will pursue together with the Securities Commission and relevant partners in the ecosystem, including players in the financial industry,” it said.
Meanwhile, since the start of the pandemic, Bank Negara Malaysia’s Fund for SMEs (BNM’s Fund) had assisted more than 52,000 SMEs including microenterprises, which employ over one million people.
The fund continued to remain available to complement the larger provision of SME financing by financial institutions.
“The allocation under the BNM’s Fund increased significantly from RM9.1 billion as at end-2019, to RM31,1 billion as at end-2021,” it said.
Bank Negara said as at end-2021, RM10.3 billion worth of funds were available to new applications.
Bank Negara said two new facilities in the fund were announced under 2022 Budget namely the Business Recapitalisation Facility and Low Carbon Transition Facility.
“These facilities assist SMEs in strengthening their capital structure and to support green financing,” it added.
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