KUALA LUMPUR (December 24): Bank Rakyat, via its subsidiary Rakyat Management Services Sdn Bhd, has launched Ar-Rahnu Flexi, to assist cooperatives operating its Islamic gold pawning Ar-Rahnu X’Change business acquire financing.

Officiating the launching, Minister of Domestic Trade, Cooperative and Consumerism Datuk Seri Hasan Malek said the programme was introduced for the benefit of all cooperatives involved in the Ar-Rahnu business gain access to  revolving working capital facilities.

Ar-Rahnu Flexi has a five-year maximum financing period with a maximum disbursement limit of up to 80% of the marhun value or pawned gold value.

“With the competitive financing package, Ar-Rahnu Flexi aimes to attract more cooperatives in Malaysia to become Ar-Rahnu X’Change franchisees as well as helping them manage their cash flow efficiently,” he said during the launching ceremony today.

Abdul Razak Abu Bakar, Bank Rakyat’s senior vice president, corporate banking, said there are currently 90 Ar-Rahnu outlets, 48 of which are franchised out to 28 cooperatives.

Since 2008, Bank Rakyat has granted approximately RM370 million to the cooperatives, he said.

“For the next year, Rakyat Management Services intends to open at least 30 more outlets under cooperatives. This would add another approximately RM150 million in financing for the new outlets,” he said.

Currently, the Ar-Rahnu business, which are franchised out to cooperatives, contribute about RM1.4 million per month on average to Bank Rakyat’s total revenue, which translates to approximately RM16.8 million per year.

Going forward, Abdul Razak expects positive growth next year from the introduction of Ar-Rahnu Flexi, but said that significant contribution would only be visible after three years.

“For the first year, there will not be much growth. Usually, it will start to pick up by the third year. There will be growth in 2015, but probably in the single-digit region,” he said.