Titled “How Budget 2022 Can Drive Your Business Forward”, the webinar was held on Nov 5 and hosted by TV host Naz Rahman.
During the webinar, Credit Guarantee Corp Malaysia Bhd (CGC) SME advisory and marketing vice-president Jenny Hoh said: “SMEs employ 70% of the nation’s workforce. Let’s start at the basics of helping people get employment. There are a lot of perks within the budget to help people get employed.
She added that the focus on social issues is also important, as ensuring employment and reducing social issues create a strong foundation for the economy to flourish.
“In business, SMEs must plan for their own resources and capacity. When it comes to the budget, it depends on how you capitalise on government initiatives and treat it as an added advantage,” she opined.
For RHB Bank Bhd SME banking head Yip How Nang, he said that while 2021 has been a bumpy road thus far, there are a lot of opportunities to capture for the remainder of the year and into 2021 as well, with the economy expected to see a sharp rebound.
Sharing his belief that the overnight policy rate will remain at 1.75% for the rest of 2021, he stated that interest rates will thus be “largely very accommodative”. This, alongside the allocations in Budget 2022 and the fiscal measures that have been rolled out, reflects an encouraging view of the economy and for SMEs.Need for targeted approach
Meanwhile, Malaysian Associated Indian Chambers of Commerce and Industry (MAICCI) secretary-general Datuk Dr A.T. Kumararajah provided a different viewpoint.
“Most SMEs are happy with the budget, but as we move from the stage of pandemic to endemic, certain areas need improvement – in terms of clear focus and narrative – to anchor that growth story.
“That’s really not there and especially from an SME’s perspective, despite all the government’s efforts, whether we can kick off 2022 with the kind of speed that’s needed to spur the economy will depend on the government providing the impetus.
“The budget must continue to support the impacted individuals and business community with targeted relief measures with an adequate support system,” Kumarajah said.
While SMEs continue to face challenges they have been grappling with all along, the pandemic has worsened matters to the point where the majority could not cope. Such issues include access to financing and cashflow management, which means that it will take time before smaller businesses see positive cashflow coming in, he said.
Although he lauded the government’s efforts to revive the tourism sector in Budget 2022 – amounting to RM1.3bil across seven initiatives, including the extension of the Wage Subsidy Programme – he said the implementation and disbursement of some other initiatives, such as the RM600mil Bank Pembangunan Malaysia Bhd’s Rehabilitation Scheme and Penjana Tourism Financing, is still not reverberating at market level.Turning towards digitalisation
In addition, Malaysia Retail Chain Association (MRCA) president Shirley Tay concurred that as part of continuing incentives and financial assistance given to SMEs, the Wage Subsidy Programme is a definite plus that would create more employment opportunities.
“The government is also looking at training up young talents, where companies that hire school leavers and graduates can enjoy an incentive of RM900 for six months per person,” she said, also naming the MyStep initiative as a positive step.
That said, she expressed her disappointment when it came to the issue of rental, in which huge outstanding rental payments to landlords are a huge burden on businesses.
“I was hoping that the government would look into direct subsidies for rental relief, where tenants will be given some support to pay their landlords,” she added.
The government’s allocation of RM250mil in Budget 2022 for the “Shop Malaysia Online” and “Go-eCommerce Onboarding” campaigns also bodes well for the SME community. The programmes have already benefited about 500,000 local entrepreneurs thus far.
This is under the special focus to help local entrepreneurs to switch to digital services in next year’s budget, which will also see SMEs eligible to receive up to RM2,000 in benefits for adopting e-commerce, online marketing and digital payments.
Added to that is the enhancement of the SME Digitalisation Grant Scheme in 2022, which can act as a shot in the arm for smaller businesses and entrepreneurs. Under Budget 2022, the total fund has been increased to RM200mil, of which RM50mil is earmarked for bumiputra micro-entrepreneurs located in rural areas.
“We’ve seen that the market has become an even playing ground in the past two years, when digitalisation came to the forefront due to market needs,” said Maxis Business SME head Kevin Lee.
Since 2020, Maxis Business has partnered with the Malaysia Digital Economy Corp (MDEC) and the Finance Ministry to reach out to Malaysian SMEs to bring them onboard the SME Digitalisation Grant Scheme.
He explained, “The grant is targeted towards helping 100,000 Malaysian businesses, particularly the small ones, kickstart their digitalisation journey. Maxis has been a key partner with MDEC driving this initiative and thus far, we’ve helped 15,000 SMEs start their journeys, whether it’s to start a small e-commerce platform or as simple as helping a retail or food and beverage business adopt a point-of-sales system.
“SMEs know they have to start an online presence or shift their operations to enable remote working, but often, they do not know where to start. This grant is catered towards helping them take that first step.”
For PKT Logistics Group Sdn Bhd chief financial officer Pang Kong Chek, he said the company has been digitally ready since before the Covid-19 pandemic, in terms of basic processes such as implementing an enterprise resource planning system.
“When the pandemic hit, it quickened the pace of our digital transformation to come up with a plan to tackle the current challenges of movement restrictions via remote working and artificial intelligence and robotics.
“We came up with a diversification strategy for product and geography, among others, as we expanded into recession-proof industries to capture other segments and clients, to ensure that we are better positioned in the coming years should another crisis hit,” he shared, adding that PKT Logistics has set a target for 20% of its revenue to come from digital channels by 2025.
When asked for advice on how companies can start their digital transformation journeys, he said that they should start from small steps and roll it out across the organisation.
“Start with small steps via easy areas to digitalise and achieve small wins, before rolling it out across the different aspects throughout the company,” he added.
SOBA 2021 is organised by Star Media Group Bhd with CGC, Maxis, PKT Logistics and RHB as main sponsors and Matrade as official trade promotion partner.
Supported by the International Trade and Industry Ministry and Bursa Malaysia, it is audited by BDO with 988 and Suria as official media partners.
For more information on SOBA 2021, call The Star Events at 017-231 1789 or visit www.soba.com.my.