KUCHING: Malaysian Employers Federation (MEF) welcomes the Ministry of Entrepreneur Development and Cooperatives (KUSKOP’s) RM100 million financing allocation for micro, small and medium enterprises (MSMEs).
The allocation is being rolled out through the BR PROSPER-i and SME Bank SUCCESS financing programmes.
MEF President, Datuk Syed Hussain Syed Husman, said access to affordable and appropriate financing remains one of the most critical challenges for MSMEs.
“MSMEs form the backbone of the Malaysian economy, accounting for more than 97 per cent of business establishments and providing employment to the majority of the workforce.
“However, many viable MSMEs continue to face structural difficulties in accessing financing that is affordable, timely and aligned with their business realities,” he said.
He noted that MSMEs are operating amid rising input costs and tighter margins.
He added that global economic uncertainty and increasing demands for productivity, digitalisation and compliance are adding pressure.
“Most MSMEs operate with limited cash reserves,” he said.
“They depend on stable cash flow to meet daily commitments such as wages, supplier payments, utilities and statutory obligations.”
He said financing is often needed to ensure business continuity and workforce retention.
He added that it also supports gradual productivity improvements, rather than aggressive expansion.
“Conventional financing channels may not always suit MSME operating models due to stringent collateral requirements, lengthy approval processes and cost structures that place additional strain on cash flow.
“Targeted financing initiatives such as BR PROSPER-i and SME Bank SUCCESS help to ease these pressures by providing more accessible and competitively priced funding options,” he added.
Syed Hussain said the facilities offered through Bank Rakyat and SME Bank can help MSMEs stabilise cash flow and manage short-term cost pressures.
He stated that the programmes can also support incremental investment in technology adoption, process improvements and workforce upskilling.
“Access to sustainable financing enables employers to retain employees, improve operational efficiency and strengthen their resilience.
“These are essential foundations for long-term business growth and competitiveness, particularly for MSMEs navigating an increasingly challenging business environment,” he said.
In light of this, he also commended KUSKOP Minister Steven Sim and said that the approach would help ensure financing support reaches a broad cross-section of the business community, including micro-enterprises and underserved segments.
“MSMEs are not merely contributors to the economy, they are its primary engine.
“Every measure that strengthens MSMEs has a direct multiplier effect on job creation, household income and domestic demand.
“Supporting MSMEs ultimately supports economic stability and social well-being,” he said.
He further stressed that MSMEs play a critical role in workforce development by providing employment opportunities for young workers, first-time job seekers and semi-skilled employees.
“I urge employers and MSME operators to leverage the financing facilities, while stressing sound financial management, prudent business planning and good governance to ensure longer-term viability,” he concluded.
