The Catalysts of Entrepreneurship in Malaysia

1. The Catalysts of Entrepreneurship in Malaysia Financing Services offered by the Banks by Group 4- Fantasy Fashion Enterprise MGM4183

2. Shareholders • Toh Chee Man (Chairman) 130388 • Phong Chai Wan 129452 • Mak Yin Tong 129615 • Lim Pui Chi 129824 • Shazwani Bt Johari 131095 • Norina Bt Mohamad 132054 • Ilyani Bt Adnan 132064

3. Why we looking for financing services? When Ideas/Opportunities are identified, and have been analyzed that they are feasible. Capitals are needed to generate business facilities, stocks, workforce & etc. With sufficeint capitals and innovative ‘on hands’ management, expected/unexpected amount of profits can be earned.

4. Objectives • To identify the banks that providing the financing services to the SME, SMI, or Fresh Graduate who wish to be an Entrepreneur. • To identify the types of products/ services that offered by a particular bank. • To provide & share the useful information above with the lovely classmate and our dearest lecturer, En. Rudaini.

5. Banks Identified • AgroBank • CIMB Bank • MayBank • Public Bank • Bank Negara Malaysia (Another Power Point)

6. AgroBank • Bank Pertanian Malaysia offers attractive financing facilities/packages to modernise and develop the agricultural, livestock and fishery sectors in Malaysia

7. Scope of financing • provide both Conventional and Islamic Financing facilities for all types of Agriculture and Agrorelated projects. This includes production, processing and marketing activities. • Agriculture includes farming, livestock rearing, fishery and forestry. • provide financing for startups and also for expansion of existing projects. • All Malaysian citizens and Malaysian companies and associations are welcome to apply for credit facilities • Margin of financing : finance up to 70% of project costs

8. LOAN APPLICATION • Loan applications with relevant documents can be submitted to any branch, regional office or Head office. DISBUSRTMENT OF FUNDS • Disbursement of funds will be made based on the actual progress of the project or upon receipt of documents acceptable to the bank. LOAN REPAYMENT • Depending on the type of project financed, loan repayments can be via monthly, quarterly or half yearly instalments

9. SPECIAL LOAN SCHEMES • MPPB (Bumiputera Community Trade & Industry Scheme) • SUTKS (Agriculture Entrepreneurs Scheme for Graduates) • TIKS 2 (Small and Medium Industries Fund 2)

10. MPPB (Bumiputera Community Trade & Industry Scheme) OBJECTIVE • Encourage the development of Bumiputera entrepreneurs in the agricultural sector. ELIGIBILITY • Private Limited Companies with a paid up capital of more than RM100,000.00. • Farmers and Fishermens Instituitions with more than RM100,000 equity. • Existing entrepreneurs. • Applicants recommended by the Ministry of Agriculture or its departments or agencies.

11. PROJECT THAT CAN BE FINANCED • Commercial Agriculture • Crops • Livestock • Fishery • Agro-based Industries • Food processing. • Feedmeal • Medicines and chemicals (livestock, fishery or crops) • Manufacturing. • Agricultural Services • Land Purchase (must be less than 25% of the total project cost)

12. MARGIN OF FINANCING • Up to 90% of the total project cost. FACILITY LIMITED • Minimum RM10,000.00 • Maximum RM5 million. INTERST RATE • 3.75% per annum. LOAN TERM • Not exceeding 10 years. • Maturity date must be on or before 23 October 2014. COLLATERAL • All loans must be fully secured.

13. SUTKS (Agriculture Entrepreneurs Scheme for Graduates) OBJECTIVE • To reduce the unemployment rate among graduates. • To produce commercial agricultural graduates. ELIGIBILITY • Unemployed graduates who are interested in the agricultural sector and want to develop a full time career in agriculture.

14. The SUTKS programmes • Placement Programme • Induction course • Practical training in the project of your choice with the Bank's customer for 1 to 3 months. • An allowance of RM20 per day up to a maximum of RM500 per month during the training period. • Financing Programme • Upon successful completion of the training programme, participants can apply for financing from the bank to operate the chosen project.

15. Project which can be finance • Food production and processing involving crops, livestock and fishery. • Upstream products for food production for example fish fry and feed meal. • Projects with quick returns are encouraged. • Financing is for both fixed assets and working capital.

16. TERM and CONDITION • Financing Amount • Up to 100% of the project cost. • Maximum sum of RM50,000.00 • Financing Term • Up to a maximum of 6 years • Type of Financing • Al-Bithaman Ajil (BBA) financing with a profit rate of 3% • Repayment • Loan repayment begins with the returns from the project. • Collateral/Guarantees • At least 2 guarantors. • Cross guarntees are allowed among participants of group projects. • Takaful Assurance • Takaful Mortgage Term Assurance. • Processing Fees • RM50 for loans up to RM30,000.00 • RM100 for loans above RM30,000.00 • Legal Charges • 0.5% of the approved financing amount subject to a minimum charge of RM20.00 • Security Deposit. • Waived

17. TIKS 2 (Small and Medium Industries Fund 2) Objective • To finance the working capital requirements of entrepreneurs in small and medium sized industries which are agro-based. Eligibility • Malaysian companies, associations and cooperatives. • Share holders capital of RM 10 million or less.

18. Project which can be finance • All agro-based industries including • Farm machinery/equipment • Estate Development • Research and Development • Food processing • Food packaging Margin of Financing • Up to 70% of the project cost. Financing Limit • Minimum of RM50,000.00 • Maximum of RM3 million.

19. Type of financing available • Both conventional and Islamic (Al-Bai'Bithaman Ajil) Interest/Profit rate • 5% per annum. Financing Term • Not exceeding 3 years Collateral • All loans must be fully secured

20. CIMB’s Financing Schemes • Pro Finance • Business Premises • Loan PETROPACK Financing Package • TNB Vendor Financing • Skim Jaminan SME Bank • Exim Overseas Guarantee Facility (EOGF) • Biz-Access • Government Aided Fund • Non-Government Aided Fund

21. Government Aided Fund • Fund for Small & Medium Industries 2 (FSMI 2) • New Entrepreneur Fund 2 (NEF 2) • Small Debt Resolution Scheme (SDRS) • Rehabilitation Fund for Small Business (RFSB)

22. New Entrepreneur Fund 2 (NEF 2) Purpose of loan • Working capital • Expansion of productive capacity or • Both of the above • Restriction - Financing should not be used for :- • Purchase of shares Refinancing of existing credit facilities • Purchase of land / Real estate investment • Properties development • Investment holding company • Activities where stock in trade is money; and (including credit, leasing,  factoring and insurance businesses) • Non-economic or non-healthy activities.

23. Eligibility • Business Enterprise / SME with annual sales turnover not exceeding RM25 million OR full-time employees not exceeding 150. • Must fall within the definition of SMEs • Maximum shareholders' funds not exceeding RM2 million. • Shareholding by Public Listed Companies and Government Link Companies (if any) should not exceed 20%. • Wholly owned Bumiputera institutions residing in Malaysia incorporated under the Companies Act 1965, the Co-operative Societies Act 1993, the Societies Act 1966, registered with Companies Commission of Malaysia (CCM) or any other authoritative bodies. • Not more than 7 years in operation. Discretion is given to FIs to consider SMEs with more than 7 years in operation provided average net profit is marginal over the last 3 years (i.e. less than 5% net profit margin).

24. Non-Government Aided Fund • Small Entrepreneur Guarantee Scheme (SEGS) • Direct Access Guarantee Scheme (DAGS) • Franchise Financing Package (FFP) • Credit Enhancer Scheme (ENCR)

25. Small Entrepreneur Guarantee Scheme (SEGS) Purpose of loan • Working capital and asset acquisition. Eligibility • All Malaysian owned and controlled companies registered under the Companies Act 1965, the Co-operative Societies Act 1993 and entrepreneurs registered with the Companies Commission of Malaysia or any other authoritative body. • Must fall within the definition of SMEs • Borrower can have only one loan under CGC guarantee at any one time. No multiple guarantees are allowed. • Borrower should not have any adverse record in respect of borrowing from any government agency or Financial Institutions. • Franchise business can apply under this scheme.

26. Maybank 's SME Financing Products: • FAC3 plus • Factoring • Government Aided Loan Schemes • IT plus

27. FAC3plus • is an integrated business property financing package specially tailored for Small and Medium Industries (SMIs) • have access to Maybank Group's various resources, from business property and equipment financing, to provision of working capital as well as general and life insurance coverage.

28. Key Benefits of FAC3plus • Financing / refinancing of completed and under construction properties, purchased for owner occupation. • Higher Margin of Financing • Flexibility to combine FAC3plus rates with special funded rates under Government Aided Loan Schemes • Pre-approved Factoring and Hire Purchase facilities • Flexibility to revise and repay monthly Term Loan installments • Financing of both stamp duty and legal/documentation fees

29. Factoring • The selling of a company's accounts receivable to a third party, in order to obtain funding. • Maybank will purchase the Client's approved trade invoices and provide the cash advance upfront. • Maybank will then proceed to collect the factored trade debts from the debtors.  

30. Government Aided Loan Schemes The following government aided loan schemes are available at Maybank: • Fund For Small And Medium Sized Industries 2 ( FSMI 2) • Rehabilitation Fund For Small Business (RFSB) • New Entrepreneur Fund 2 (NEP 2) • New Principal Guarantee Scheme (NPGS) • Direct Access Guarantee Scheme (DAGS) • Direct Access Guarantee Scheme (DAGS)/NEF 2 Guarantee Scheme For Bumiputra Retail Business (PROSPER) • Small Entrepreneur Guarantee Scheme(SEGS) • Small Entrepreneur Guarantee Scheme (SEGS-Bumiputra 10% Guarantee )

31. Maybank ITplus • Malaysia's first term loan package specially designed to assist Small and Medium Enterprises (SMEs) in acquiring the latest IT solutions. • Solutions that will provide your business with a competitive edge; lower costs, increased productivity and customer responsiveness. • SMEs are invited to apply for loans ranging from RM15,000 up to RM500,000 to invest in hardware and software IT solutions. • Package benefits include: • High Margin of Advance • Attractive borrowing rates • Affordable repayment terms

32. Types of IT Solutions Financed • IT Solutions (hardware and software) marketed by approved IBM and Intel Solutions vendors • Categories of IT Solutions include: • Corporate Governance • Risk Management • Human Resource Management • Accounting • Customer Relationship Management • Enterprise, Resource and Production Planning

33. PB’S PRODUCTS & SERVICES FOR THE SMEs Types of loans: • Working Capital - to raise capital to aid in the running of your business. - provides financing packages, eg. overdraft, revolving credit & trade financing. • Acquisition of Assets - whatever assets your business needs, these financing packages are designed to help you acquire them. • Project Financing - provide all the necessary funding, or arrange to provide it jointly with other financial institutions.

34. Vehicle Financing - Offers attractive vehicle financing packages to make owning a new company vehicle easy and fast. • Product Packages - Offers full range of loan packages to suit your financing needs, - eg. PBMicro Finance, Fund for Small and Medium Sized Industries 2 (FSMI2) & New Entrepreneurs Fund (NEF2). • Credit Guarantee Corporation (CGC) Guarantee Schemes - Ideal to help new entrepreneurs obtain the financing they need even if they do not have the necessary collateral. - eg. New Principal Guarantee Scheme (NPGS) & Small Entrepreneur Guarantee Scheme (SEGS).

35. More Services For SMEs - Provide comprehensive assistance packages in terms of banking services that give more convenience and help improve efficiency. - business support services to keep you well-informed and help give you an edge over your competitors. http://www.publicbank.com.my/en/en_content/business/sme/landing.html

36. Conclusions • There are many local banks offering various attractive financing services to the local entrepreneurs/ those who wish to start up a business as an entrepreneur. • The entrepreneurs may consider and choose among the variety of services by analyzing the amount of financing they required, the interest rate, the repayment method/period.