KUALA LUMPUR: Up to half of entrepreneurs receiving government financing and assistance this year are expected to be first-time beneficiaries as Putrajaya steps up efforts to ensure support reaches a wider pool of micro, small and medium enterprises (MSMEs), says Steven Sim (pic).
The Entrepreneur Development and Cooperatives Minister said the ministry was targeting 40% to 50% of recipients under its financing and assistance programmes to cover entrepreneurs who had never previously received government support, as part of efforts to broaden access instead of repeatedly assisting the same group of businesses.
“We have to be more aggressive in finding new participants,” he said after a briefing about the MSME performance report 2025 at SME Corp Malaysia here yesterday.
He said agencies under the ministry had channelled RM7bil in financing, grants and other assistance to more than 213,000 entrepreneurs and businesses so far this year.
As an example, Sim said Tekun Nasional had approved more than RM540mil in financing to about 26,000 entrepreneurs in the first six months of the year, most of whom were first-time borrowers.
When asked, he said agencies had also been instructed to intensify outreach through roadshows and collaborations with industry associations and non-governmental organisations to ensure more entrepreneurs, particularly micro businesses, were aware of the government’s financing, training and market access programmes.
Sim acknowledged that many entrepreneurs continued to find it difficult to navigate the numerous government initiatives available, noting that about 140 financing schemes were offered across various ministries and agencies.
“We want to galvanise all government efforts so that every programme, every policy and every ringgit spent addresses the real pain points faced by businesses,” he said.
Sim noted that the government’s priority had also shifted from simply creating more businesses to helping existing firms grow into more competitive enterprises.
“The real challenge is not merely creating more businesses, but ensuring Malaysian businesses can scale up – micro enterprises becoming small enterprises, small enterprises growing into medium-sized firms, and more local companies breaking into global markets.”
His remarks came as the Department of Statistics Malaysia (DOSM) reported that Malaysia’s MSME sector expanded by 5.7% in 2025, outperforming the country’s overall economic growth of 5.2% despite persistent geopolitical tensions and global trade uncertainties.
The sector’s value added rose by RM40bil to RM689.8bil, increasing its contribution to the country’s gross domestic product (GDP) from 39.5% in 2024 to 39.7% last year.
Malaysia had nearly 1.3 million MSMEs in 2025, representing 96.2% of all business establishments, an increase of almost 20% from the previous year.
However, Sim said the structure of the sector remained a concern, with more than 77% of MSMEs still classified as micro enterprises, while only 1.1% had grown into medium-sized firms.
He likened the trend to an “hourglass” that had persisted for the past decade, where the base of micro enterprises continued to widen and the number of medium-sized businesses shrank, while large companies became even bigger.
To address this imbalance, he said the ministry aimed to increase the proportion of medium-sized enterprises to 5% by 2030.
Sim said all five major sectors of the MSME economy recorded growth last year, led by construction at 12%, followed by services (5.7%), manufacturing (4.8%), mining and quarrying (4.4%), and agriculture (1.8%).
He said MSME exports also recorded robust growth, rising 10.5% to RM214.5bil, outperforming Malaysia’s overall export growth of 5.9% as well as the 5.1% growth recorded by non-MSME firms.
To accelerate the sector’s development, Sim said the ministry would roll out the Power Up 100K initiative, backed by RM15bil in financing, grants and related assistance for 10,000 businesses to scale up, invest RM100mil in capacity-building programmes for 100,000 entrepreneurs, increase MSME GDP contribution beyond RM700bil, and nurture at least 100 Malaysian companies with annual revenue of RM100mil over the medium term.
