This article first appeared in The Edge Financial Daily on April 9, 2020

KUALA LUMPUR: Amid the Covid-19 pandemic, banks will remain supportive towards small and medium enterprises (SMEs) in terms of financing, said the Association of Banks in Malaysia (ABM).

“Financing from ABM member banks is readily available to eligible borrowers,” ABM said in a statement. “Our member banks are playing a vital role to provide access to financing, especially to viable businesses that have been adversely affected by the outbreak of Covid-19.”

On March 27, Bank Negara Malaysia (BNM) announced that it would be increasing the allocation to BNM’s Fund for SMEs by RM4 billion, bringing the total allocation to RM13.1 billion.

“This fund, which is aimed at providing assistance to more SMEs in sustaining business operations and preserving jobs as well as to support economic growth, will be made available to the SME segment via the participating financial institutions,” said ABM, adding that interested SMEs should contact the participating banks to apply for the financing available under the facilities announced by the central bank.

As at April 2, financial institutions had approved about 1,300 applications under the Special Relief Facility, Agrofood Facility and Automation and Digitalisation Facility of BNM’s Fund for SMEs, totalling RM682 million.

This was on top of other financing provided to SMEs by the banks under their own financing schemes, totalling RM42 billion in the first two months of the year.