KUALA LUMPUR: AmBank Group and Sabah Development Bank Bhd (SDB) are rolling out RM100mil worth of financing for small and medium enterprises (SMEs) in Sabah in the first quarter of this year.
In a virtual media briefing, SDB said the financing plan, known as “Sabah SME Guarantee Scheme” would offer up to RM1mil for each borrower in Sabah to mitigate the adverse impact of the Covid-19 pandemic.
AmBank Group chief executive officer Datuk Sulaiman Mohd Tahir said the scheme would also provide a six-month moratorium on instalments.
“This will allow our customers to extend instalments of payments for up to six months. Customers will also not be burdened with instalments because we understand they are affected by the current pandemic, ” he said after inking the memorandum of understanding (MoU) with SDB.
The Sabah SME Guarantee Scheme is a financing facility that aims to provide working capital exclusively for SMEs in Sabah.
Besides providing customers the six-month moratorium, Sulaiman said businesses facilities would also be granted through the financing.
To date, AmBank has helped more than 130,000 customers on relief assistance comprising of businesses and individuals’ loan exposure of more than RM17bil.
Meanwhile, SDB chief executive officer Datuk Vincent Pung said the bank would act as a guarantor which would provide ease to Sabah SMEs to access the financing.
“The concern in Sabah is that approvals for loans are done in the banks’ headquarters in Kuala Lumpur.
“Perhaps, the Sabah branch can work hand-in-hand with the KL branch for the loans to be approved in Sabah to ease financing for entrepreneurs.
“This will not only help sustain SMEs who are facing challenges in managing their working capital, but for those SMEs who are tapping on opportunities to grow during this pandemic. The financing will facilitate their capital expenditure expansion as well, ” he added.
According to Pung, the partnership with AmBank group is complementary to the federal and state government’s initiatives on growing SMEs that play an vital role in contributing to the economic growth of the country.
“We are all geared towards the implementation of this scheme and other financial initiatives that empower our local entrepreneurs to cross this testing time, ” he explained.
He said the bank is looking towards financing investors that can help develop the state as well as create more jobs.
On Bank Negara’s decision to maintain the overnight policy rate (OPR) at 1.75%, Sulaiman said it would give businesses a reprieve at a low interest rate environment.
“ In the near-term, the OPR will be reviewed again. Based on the current level, it will not make much difference if there is any further reduction of interest rates at this stage, ” he said.