We all know how the year 2020 went, right?
The impact of COVID-19 on businesses, industries, and companies has surpassed exponentially. While some forward-thinking companies managed to stay ahead of the pandemic, other companies are yet to streamline, optimize, and benefit from digitalization.
After the Movement Control Order (MOC) variation in Malaysia, the government launched multiple initiatives known as grants to enhance business. With these grants, the Malaysian government aims to help them with funds and support their business growth and market activities to move smoothly and cope with their financial burdens.
In this article, we will cover the list of grants and the processes to obtain along with:
• Introduction about Grants
• How the Malaysia government is enhancing MSMEs growth through grants
• List of grants offered by the government
• Process to obtain grants
• How to apply and register for grants
•How can Deskera help small businesses in registration
Introduction about Grants
Government grants are a reward or an initiative offered by the government authority for a particular purpose or a project. With the help of grant programs, the government provides funding for businesses, institutions that help in stimulating the economy.
The government grants are set for businesses, including short, medium enterprises (SMEs). The agenda is to offset digitalization, cover marketing costs, and help maintain the competition in the evolving digital economy.
The grants help set these small businesses to improve the operations, offer value to the customers, evolve experiences and acquisition.
How the Malaysia government is enhancing MSMEs growth through grants
The Malaysian government plays a pivotal role in providing a conducive environment for the country's economic sector and supporting many small businesses and medium enterprises. There are a variety of initiatives and grants put into place to stimulate the economic and financial growth of the country. The significant funding belongs to assemblies in many industries and sectors to cope up with the Covid-19 pandemic.
The Malaysian government launched a comprehensive economic recovery plan to help Malaysian entrepreneurs and SMEs stay afloat and ensure that the country progresses with its program.
The initiatives include wages, subsidies, upskilling, tax holidays, tax benefits, and a few more.
List of Grants Offered by the Government
As mentioned, the Malaysian government has already launched its initiatives for SMEs in Budget 2021. With the help of that, businesses can take advantage of assisting their operations and marketing activities that can help grow their business sustainably.
Businesses can involve themselves through these grants and subsidies, adapt to the latest technology, and look forward to alternatives. They can open doors to invest in marketing and business expansion prospects.
Below is the breakdown of the funds and support provided by the Malaysian government for small and medium enterprises.
- SME Digitalization Grant
- Wagę Subsidy Program (WSP
- Digital Growth Subsidy (DGS)
- Digital Growth Subsidy (DGS)
- Market Development Grant (MDG)
- Targeted Loan Repayment Assistance (TRA)
- PERMAI Special Prihatin Grant (GKP)
- MARA Business Payment Rescheduling
- Boosting Online Businesses
- Electricity Bill Support
- Incentivizing Women Entrepreneurs
- Sustainable Development Goals (SDGs) Financing Scheme
- Working Capital Guarantee Scheme (SJMK)
- Safe@Work Initiative
- Supporting New Startup Launches
- Indian Community Entrepreneur Development Scheme (SPUMI)
1. SME Digitalization Grant
To move the local enterprises towards the technological arena, the government announced an SME digitalization grant in 2020.
This Government grant targets SMEs in Malaysia who want to evolve and apply for digitalization to help propel their businesses.
The SME digitalization initiative is a 50% grant for RM 5,000 per company for the first 1,00,000 applying to digitalize their business operations. The overall worth of the initiative is Rs 500 million, stretched for over five years
2. Wagę Subsidy Program (WSP)
To help businesses cope with the payroll difficulties from MCO, the government launched WSP, where employers, regardless of the sectors, can receive a subsidy of RM600 per employee earning under RM4,000 per month and can go to a maximum of 500 employees.
Additionally, there is one more initiative that will go up to RM600 to be given to homestay businesses registered with the Ministry of Tourism, Arts and Culture
3. Digital Growth Subsidy (DGS)
The digital growth subsidy is launched to enhance the digital economy by granting digital marketing funding for Malaysian companies. The grant supports 50% of the digital strategy and marketing cost for eligible businesses.
The subsidy covers four major digital strategies and marketing projects. It includes
•Positioning and branding
•Website design and basic SEO
•Social media marketing and online PR
4. Digital Tech Apprenticeship (DTA)
With the help of the DTA program, the government pushes unemployed workers to upskill and reskill themselves to succeed in the most demanded tech jobs.
• RM1200 per month as a salary for six months
• Training subsidy on courses for up to RM 8000
The focus areas of these jobs include Data Science, Cyber Security, and Software Development.
5. Market Development Grant (MDG)
Market Development Grant was established in 2002 to aid exporters in Malaysian-made goods and services. It is a reimbursable grant to businesses.
The MDG possesses a lifetime limit of RM 300000 and is exclusively designed for Malaysian MSMEs.
6. Targeted Loan Repayment Assistance (TRA)
Through TRA, the government enhances and helps the SMEs who find it challenging to repay the loan. The reason might be turbulence in income due to the pandemic.
With this, the SMEs can have the flexibility to defer monthly installments for three months with a loan amount of RM1,50,000 or reduce the installment by 50% for six months.
7. PERMAI Special Prihatin Grant (GKP)
This grant provides additional financial assistance to SMEs and micro-entrepreneurs by delivering one of assistance for the following
- SMEs registered in states under MCO up to RM1000
- SMEs registered in other states for up to RM 500
There is also provision for traders and hawkers eligible for financial assistance for up to RM 1000
8. MARA Business Payment Rescheduling
Mara Business Payment issue is an initiative to continue with the MARA PRIHATIN Peace of Mind moratorium for businesses and students.
It is basically for the entrepreneurs who have taken a loan from MARA, and those loan takers will get a grace period of three months for the repayments.
Additionally, they offer a 30% discount on MARA business premise rentals.
9. Boosting Online Businesses
The objective of this grant is straightforward. It aims to facilitate more SMEs in adopting e-commerce and e-payment to expand their market outreach. It opens doors for local businesses and individuals to receive e-commerce and e-payment onboarding training, sales support, and subsidies, irrespective of business registration.
10. Electricity Bill Support
Electricity Bill Support is one such grant that elevates business cash flow burdens for sectors that could not operate during the MCO. It offers a 10% discount on electricity bills for the most affected sectors, including hotels, theme parks, shopping malls, domestic flight offices, tour agencies, and convention centers.
Additionally, it provides a 9% bill reduction to the applied users.
11. Incentivizing Women Entrepreneurs
The objective of this grant is to incentivize and facilitate women who aspire to become entrepreneurs. With this, the government has announced DanaNITA financing schemes that help to intensify women's participation in entrepreneurial activities and encourage others to increase their household income.
There is an allocation of RM10 million in a 70% matching fund for women entrepreneurs and self-employed women.
The grant inspires and empowers the women to be self-employed and earn their living.
12. Sustainable Development Goals (SDGs) Financing Scheme
As per the United Nations Development plan, the SDG scheme was launched to support the government's effort in implementing the 17 SDGs.
The part of the fund will be provided for the eligible businesses whose operations contribute to any one of the 17 SDGs. It may include affordable and clean energy, gender equality, or sustainable industrialization.
13. Working Capital Guarantee Scheme (SJMK)
Intending to assist SMEs in all sectors and provide access to funding, the government launched the Working Capital Guarantee Scheme.
Under this, RM17.5 billion is allocated to the SJMK, which will be used for working capital purposes in various industries.
14. Safe@Work Initiative
The Safe@Work initiative is launched to act as a responsible citizen and provide a conducive work environment and place for workers working in SMEs.
This initiative is specially made for the companies belonging to the manufacturing industry and has been granted RM5,00,000 as additional tax deductions on the rental expenses of the premises.
15. Supporting New Startup Launches
As the name suggests, this initiative was launched to encourage and welcome the establishment of new SMEs. Under this, SMEs who register their operations from July 1, 2020, until December 31, 2021, can claim tax rebates up to RM20000 per year.
The scheme also allows equity crowdfunding to the unlisted limited companies and increases fundraising limits from RM 10 million to RM 20 million under PEMERKASA.
16. Indian Community Entrepreneur Development Scheme (SPUMI)
This initiative was launched to help especially the Indian entrepreneurs running their micro-businesses and want to expand in the future. Through TEKUN, the Indian entrepreneurs can get small financing schemes ranging from RM10000 to RM50,000 or Medium Financing Scheme ranging from RM50000 to RM 100000.
The scheme is also valid for Bumiputra entrepreneurs who are running micro-businesses.
The Malaysian government's grants mentioned above, incentives, and fundings aim to support marketing, digital marketing, and financing access to small and medium enterprises.
The businesses can take advantage of these grants and scale up their level for growth.
The process to obtain grants
The process to apply for the grants depends on the type of grants you are interested in and applying for.
There are certain kinds of eligibility requirements that SMEs are required to fulfill and qualify like
- Valid registration under laws of Malaysia
- Have a track record of operations
- The type of sector the SEM is associated with
All of the eligibility mentioned above is common for all grants, though there are variations attached to different sets of assistance offered by the Malaysian government.
How to apply and register for grants
As mentioned, the application and registration process of grants depends on the type of grants you are eligible for.
Following is the step-by-step process and instructions for the application for grants:
Step 1: Check the list of eligibility requirements before the application.
Step 2: After inspection, prepare the list of all documents required to submit in the application. It includes the following
- Company Registration Certificate
- Copy of identity card of Directors/ Sole Proprietors or partners
- Copy of Company Bank statement for last three months
- Other documents related to the eligibility
Step 3: Fill in the form to process your application
( The guidelines and instructions are duly mentioned)
Step 4: Apply and check the status of your application
( A message will pop up regarding successful application or failed application)
Step 5: Pay the required registration fees for the successful application and wait for the update by the government
And you are done!
At last, you will get the application number ID such that you can track down the status.
You can also visit the official website or Facebook Page of the Malaysian government for more information.
How can Deskera Help Small Businesses?
As a small business owner or a startup, you need to take care of thousands of things. In the above sections, we realized that so many essential factors could make a significant change in your business, such as barcoding, well-managed inventory, financial aid to manage your business efficiently, use of new technology, and proper marketing tools and strategy.
Of course, the Government of Malaysia has been involved in all the above initiatives so that you as a small business can rise and shine not only in India but on the global platform.
Small businesses are the backbone of every economy, and the irony is you don't hear about them often. But at Deskera, small businesses are the center of everything.
We at Deskera have always been committed to helping SMEs realize their dreams. Since its inception, Deskera has had a singular mission- To transform how SMEs run their business. We want them to grow and exceed expectations by using the best possible technology and tools.
And that is why we have designed Deskera-all-in-one - a cloud-based software suite consisting of Books, CRM, and People modules.
This intuitive and hardworking software takes some load off the back of small businesses and startups by optimizing their accounting, operations, and process workflows. Deskera is an all-in-one cloud-based accounting software that helps small businesses run their business efficiently anytime, anywhere, on any device.
Deskera all-in-one does all the below-mentioned tasks and much more for your business.
Deskera all-in-one helps small businesses in managing their general ledger efficiently. Whether its Assets, Liabilities, Equity, Revenue, or Expense, keep your worries behind.
It helps you track every business transaction across your organization.
Since Deskera automates most of the processes, all business transactions automatically populate the journal entry record. It also allows you to create recurring journal entries to save more time.
Deskera's inventory management software enables you to stay on top of your stock levels at all times and fulfill your customer orders with confidence.
The software updates your stocks in real-time and allows you to view the stock availability in each warehouse in seconds. Thus, helping you make informed decisions to optimize your inventory and reduce costs significantly.
With Pick-Pack-Ship, you can efficiently pick products from the warehouse, pack them in the carton, and promptly ship them out to customers.
There is no doubt that the MSME and startups sector plays a vital role in prospering and strengthening the economy. With the help of various schemes, initiatives, and funding, the Government of Malaysia is helping millions of small business owners, entrepreneurs, and women entrepreneurs realize their potential, build a better tomorrow, and accelerate growth to heights.
Following are the key takeaways of the article:
- The government grants help set small businesses and SMEs to improve operations, offer value to customers, evolve experiences and acquisition.
- The Malaysian government plays a crucial role in providing a conducive environment for the country's economic sector.
- The government introduced incentives and fundings to help Malaysian entrepreneurs excel in the digital world.
- There are a set of 16 grants offered and provided by the Malaysian government.
- The process to apply for grants depends on the type of grants you are interested and applying for
- The application and registration process is based on a step-by-step procedure, from inspection to the final payment