November-December . 2022 | @ Halal
Islamic Finance
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Bank Islam ’ s SME Pocket Talk series
The first SME Pocket Talk by Bank Islam was attended by over 100 participants .
SME Smart Eco would benefit SMEs that produce or adopt green technology for their business . For enquiries , visit your nearest Bank Islam branch or email to sme-assist @ bankislam . com . my .
and the public tender programme for the Large Scale Solar Programme ( LSSP ), which allows companies from the private sector to build , own , and operate solar plants to generate RE in large capacities .
Great future for halal SMEs in 2023
Malaysia is ranked among the top halal export countries in the world , and the halal economy is one of the critical sectors of growth for the country .
When asked about the prospects of the halal industry and Islamic finance in 2023 , Rizal was optimistic . He noted that official statistics indicated that halal exports climbed 19 per cent from RM30.5 billion in 2020 to RM36.3 billion in 2021 , accounting for 2.9 per cent of Malaysia ’ s overall exports . Islamic finance in Malaysia can be considered mature and has great potential to support the development of the halal industry .
“ That being said , future prospects will be aplenty . Budget 2023 had allocated RM92mil to develop the country ’ s halal industry - addressing the need for infrastructure development , promotion of halal products , compliance with halal certification and adapting to halal innovation , and many other incentives .
“ It is imperative that halal SMEs seize the opportunities and benefits made available by agencies such as the Malaysia External Trade Development Corporation ( MATRADE ), MIDA , SME Corp and the Halal Development Corporation ( HDC ) for their business growth and expansion , locally or abroad .
“ Bank Islam is proud to be a strategic partner to these agencies mentioned . As a fullfledged Islamic local bank and the first to be listed on the Main Market of Bursa Malaysia ,
we are mandated to support the growth of the halal economy in Malaysia .
“ Our products , such as the Go Halal SME , SME Biz Grow , SME Exporter and SME Smart Eco , are all designed to support the growth of SMEs in the halal industry . We aim to strengthen our SME portfolio with Shariahcompliant financing products and services that meet the ever-evolving needs of halal SMEs .”
BANK ISLAM Malaysia Berhad successfully organised the SME Pocket Talk by Bank Islam seminar on Sept 13 , 2022 , at Kepala Batas , Penang . The programme was aimed at sharing information about the opportunities and support available to SMEs by Bank Islam and its strategic partners .
In his welcome remarks at the event , Bank Islam ’ s SME Banking Director , Rizal Yusof said : “ Today ’ s programme is to promote cooperation between the government and private sectors including the SMEs , to contribute toward rebuilding and strengthening Malaysia ’ s economy .”
The programme witnessed the participation of over 100 Bank Islam customers , with more engagements planned nationwide . Rizal encouraged the participants to leverage on all available avenues provided by the government , private sectors and the Islamic financial institution and hoped the seminar would benefit them with the best approach to strengthen and thrive in the evolving business environment .
“ Do reach out to us and our partners should you have further enquiries , and we will be happy to assist you ," Rizal concluded .
Rizal Yusof ( left ) & Noor Azmi Ibrahim , SME Northern Regional Head at SME Pocket Talk by Bank Islam seminar .
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the investment , MIDA will reimburse half of it .”
The financing is eligible for Malaysian
SMEs that fulfil the criteria such as :
• Meet the definition of SMEs as issued by SME Corporation Malaysia , with the business in operation for at least two years .
• Malaysians residing in Malaysia , who hold a minimum of 51 per cent shareholding in the business .
• Companies producing promoted products or engaged in promoted activities in priority sectors such as :
• Manufacturing : Aerospace , medical devices & pharmaceuticals , machinery and
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equipment , & other industries , on a case-by-case basis .
• Services : Research and development ( R & D ), technical and / or skills training , logistics service providers ( 3PL ) & integrated green technology project .
“ A total fund of RM100 million has been set up for this arrangement between Bank Islam and MIDA with up to RM5 million per SME has been allocated by Bank Islam for this arrangement . However , if the SMEs have higher requirements , we can go off the shelf and look at a tailor-made solution rather than the one stated
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in the package .”
Financing CAPEX and WCR
The financing provided by Bank Islam for DISF under MIDA will allow SMEs to finance Capital Expenditure ( CAPEX ) for the modernisation and upgrading of facilities and tools so that SMEs can undertake manufacturing or services for multinational corporations ( MNCs ), Malaysian conglomerates ( outsourcing activities ), and licensing or purchasing new high technology .
“ One is for CAPEX ; the other is the Working Capital Requirement ( WCR ). The working capital financing is to cater for activities such as training of
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Malaysian employees ; R & D activities that are carried out in Malaysia ; obtaining international standards / certifications such as JAKIM ’ s halal certification ; legal documentation cost , and BRTT / BLTT contribution cost .”
Rizal said the collaboration with MIDA would provide a platform for over 3000 SME clients within the Bank ’ s portfolio , giving them the opportunity and access needed to strengthen their business .
“ It allows us to develop our SME portfolio and help customers meet their financial needs , enabling them to expand their presence in the local market and more .”
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