MIDF to disburse RM280m in soft loans [ 20-05-2011 ]
By Hamisah Hamid
Published: 2011/05/18
KUALA LUMPUR: Malaysian Industrial Development Finance Bhd (MIDF) plans to disburse a total of RM280 million in soft loans to the small and medium enterprises (SMEs), manufacturers and automotive vendors this year.
The three loan schemes are Soft Loan for SMEs (SLSME), Soft Loan for Automation and Modernisation (SLSAM), and Soft Loan for Automotive and Development (SLSAD).
Group managing director Datuk Mohd Najib Abdullah said for the SLSME scheme, MIDF expects to disburse about RM170 million this year.
"Loan disbursements under the SLSAD are expected to total RM80 million, while for SLSAM, we expect to disburse some RM30 million," he said in an interview with Business Times recently.
Najib said the SLSME is a financial assistance programme to promote the development of existing and start-up SMEs.
The financing covers the construction of industrial or commercial buildings, the purchase of ready-built industrial or commercial buildings and machinery or equipment, as well as for working capital.
"This programme also promotes the adoption of ICT in business management and operations to improve competitiveness, efficiency and productivity," he said.
Since the launch of the scheme 10 years ago, MIDF has approved 1,381 loan applications totalling RM953 million. Between 2001 and December 2010, loan disbursements amounted to RM608 million.
Najib said the SLSAD is a scheme to help automotive component and parts manufacturers in tooling acquisition, development and production, as well as improvement of productivity and export performance. It is also to promote the rationalisation of operations among manufacturers.
He said between 2007 and December 2010, MIDF had approved 94 loan applications under SLSAD totalling RM356 million. As at end of last year, loan disbursements amounted to RM201 million.
The SLSAM, meanwhile, aims at assisting companies to modernise and automate their manufacturing processes, thus minimising dependence on labour-intensive activities and foreign workers.
"The scheme provides financing to manufacturers for the purchase of automation-related machinery or equipment, and software and computer peripherals related to the development of the automation system."
Najib said from the launch of the scheme in 2007 until December last year, MIDF had approved 89 loan applications amounting to RM187.8 million. As at December 2010, loan disbursements amounted to RM139.1 million.
MIDF was established in March 1960 to ensure access to financing for manufacturing-based SMEs. Today, the group is a financial services provider in three core areas, namely investment banking, asset management and development finance.
