KUALA LUMPUR: Bank Rakyat today announced a RM200 million allocation to assist small and medium enterprises (SMEs) in the oil and gas service and equipment (OGSE) sector through a vendor financing programme.
Entrepreneur Development minister Datuk Seri Redzuan Yusof said a memorandum of understanding (MoU) signed between Bank Rakyat and Petronas will further improve the vendors' working capital and cash flow in completing contracts awarded by Petronas.
"This strategic alliance will also ensure successful completion of contracts undertaken via sound management of financing facilities offered by Bank Rakyat," he said in his speech in conjunction with the MoU signing today.
He added that Bank Rakyat, an agency under his ministry, will be providing financing facilities to OGSE vendors of up to RM10 million to eligible SME vendors that have secured contracts from Petronas and complied with the bank's credit assessment.
Meanwhile, Bank Rakyat chief business banking officer Abdul Razak Abu Bakar said the RM200 million is the allocation for the first phase and will be added to if the demand increases.
"Prior to this MoU, a total of RM15 million had been disbursed to seven vendors in the OGSE sector, and with the new collaboration with Petronas, we aim to see an increase," he said, adding the vendors must be officially appointed by Petronas.
He added that after the agreement with Petronas, Bank Rakyat is looking to implement a similar structure for vendors for government-linked companies especially Telekom Malaysia and Tenaga Nasional Bhd
. - Bernama