Last updated on October 11, 2025
KUALA LUMPUR, Sept 8, 2025 — In a decisive move to empower Malaysian SMEs, SME Corporation Malaysia (SME Corp) has unveiled a RM35 million allocation under its Alternative Financing Programme 2025, in collaboration with fintech firm microLEAP. This initiative, part of the Business Accelerator Programme (BAP), offers Shariah-compliant financing of up to RM400,000 per SME at an attractive profit rate of 3.5 percent per annum—with a compelling caveat: up to 40 percent of the loan may be converted into a grant for businesses that demonstrate strong repayment discipline.
This latest injection boosts the total funds allocated through the SME Corp–microLEAP partnership since 2021 to RM70 million. According to SME Corp CEO Rizal bin Dato’ Nainy, the programme reflects a strategic reimagining of SME support, one that goes beyond mere access to credit by rewarding financial excellence and growth-oriented conduct. Rizal underscored the initiative’s alignment with national ambitions, particularly the plan to elevate the share of small enterprises that scale into medium-sized businesses from just 1.6 percent today to 5 percent by 2030.
The financing is designed to catalyze both operational and strategic enhancements among SMEs. It covers working capital needs, as well as investments in machinery and equipment, ESG integration, product certification, advertising and promotion, and ICT adoption. Critically, only SMEs with timely repayment records will be eligible to convert up to 40 percent of their financing into grant funding—pending approval from SME Corp.
SMEs account for more than 96 percent of all active businesses in Malaysia, yet many remain underserved by conventional financial institutions. This convertible grant financing model effectively addresses key challenges: it lowers repayment burdens, incentivizes prudent financial management, and enables meaningful reinvestment in business expansion.
