Image credit: Malaysiakini
KUALA LUMPUR: Bank Negara Malaysia says that credit conditions continue to support businesses' financing needs, with business financing growing by 5.1 per cent in 2024 compared to 3.7 per cent in 2023.
Of this, outstanding SME financing growth continued to remain strong at 8.1 per cent (2023: 8.7 per cent), supported by continued disbursement mainly for working capital purposes, the central bank said in its Annual Report 2024.
New SME financing approvals grew during the year amid a higher approval rate of 81.5 per cent (2023: 80.9 per cent), particularly for the construction sector.
Bank Negara's Fund for SMEs, which accounted for eight per cent of outstanding financing to SMEs, complemented financing from banks and development financial institutions (DFIs).
As of end-2024, about RM5 billion remained available for utilisation.
"The current focus is to channel funds into areas aligned with national economic and development priorities, including accelerating digital transformation and the greening of SMEs," Bank Negara said.
In 2024, outstanding DFI financing grew by 5.6 per cent to RM183.3 billion (2023: 6.0 per cent to RM173.5 billion), supporting more than three million SMEs, microenterprises, start-ups and the low-income group.
The financing has yielded positive impacts, creating and sustaining employment for more than 130,000 individuals.
Additionally, in 2024, more than 14,000 business customers were able to grow their businesses, as evidenced by higher sales turnover and business expansion.
During the year, Bank Negara upsized the High Tech and Green Facility and Agrofood Facility to a total allocation of RM6.2 billion to support increasing demand for digital transformation in strategic sectors and agrofood production.
The Micro Enterprises Facility was also upsized to RM1 billion to cater to future demand.
The scope of the Fund for SMEs will be reviewed to ensure that it continues to meet the needs of Malaysian SMEs.
This includes enhancing SMEs' resilience against floods, targeting financing to younger SMEs, and providing additional support for SMEs in the tourism sector in view of the upcoming Visit Malaysia Year 2026.
Bank Negara will also assess and enhance the design of the fund to further increase its impact on the unserved and underserved segments in line with Malaysia's economic aspirations.
This includes exploring innovative models beyond concessionary financing and ways to crowd in larger private sector participation.
Source: https://www.nst.com.my/business/corporate/2025/03/1192505/bank-negara-enhances-access-financing-dfi-loans-grow-rm1833bil