AGRICULTURE-BASED smallholders, existing and potential entrepreneurs and small traders have a better chance to strengthen and expand their operations despite the current economic uncertainties, with the RM1bil micro credit scheme.
Of the total allocation, RM500mil for micro credit scheme would be placed under Bank Pertanian Malaysia Bhd and RM200mil for Amanah Ikthiar Fund (also placed under Bank Pertanian). At the same time, an additional RM1bil Food Fund has also been placed under Bank Pertanian.
Bank Pertanian general manager Datuk Mohd Rosli Abdul Aziz said: We welcome the economic package, particularly the strong emphasis given to the agricultural sector.
As a financial service provider to the agricultural sector, Bank Pertanian has served the agro-industry since 1969.
Rosli said the timing of the new allocation was very good as the economy in general and the agriculture industry particularly, strongly needed the extra push.
First, we will need to thoroughly review the allocation by the government, and then formulate a policy to implement and disburse this grant in the best possible manner, he added.
On the additional RM1bil Food Fund, he said: I believe this is the extension of the Fund for Food set up in 1994, which ended last year. The government had allocated the Fund for Food to the banking sector, including Bank Pertanian.
Bank Pertanian has been successful in disbursing almost 70% of the fund, compared with the other banks, he said.
Meanwhile, National Smallholders Association president Datuk Mazlan Jamaluddin said the allocation for micro credit scheme could encourage more rubber smallholders (2ha and below) to consider other forms of activities such as cattle rearing, aquaculture, cultivation of vegetables and fruits as well as food based industry.
These smallholders could now apply for loans from the development banks for help in realising better business, he said.
Under the micro credit scheme, low interest rates at 4%, no collateral but based on securitisation of cashflow and repayment schedule was according to viability of cashflow.
Smallholders could also explore the prospects of venturing into the food business with the allocation of the RM1bil Food Fund under Bank Pertanian, Mazlan said.
On the RM200mil initial fund for the Rubber Forest Plantations Fund, Malaysian Palm Oil Association (MPOA) chief executive M.R. Chandran said: This will encourage plantation companies who have marginal areas not suitable for oil palm to consider planting rubber trees instead.
Despite MPOA being the voice of the palm oil sector, some 15 of its members including big oil palm companies like Kuala Lumpur Kepong Bhd, Golden Hope Plantations Bhd and Felda still have rubber estates totalling 100,000ha.
Chandran said the rubber industry is not a sunset industry. Last year, total rubber exports (rubber, rubber products and furniture) stood at RM13bil.
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