Some small and medium-sized enterprises (SMEs) may find themselves in need of financial assistance from time to time, particularly over the last few years due to the COVID-19 pandemic. Some of this assistance may be focused on recovering from a period where the income was low, or simply, to help expand and keep building the business.
That’s why the Malaysian government launched multiple grants to enhance businesses. These grants were created to support the growth of the businesses and smooth marketing activities to help them cope with financial burdens.
If you're a small or medium-sized business owner in Malaysia, you may just qualify for the SME grants offered by the Malaysian government. In this article, you'll discover everything you need to know about the SME digitalisation grant and other business grants your government offers.
Why You Should Get A Business or Startup Grant For Your Small Business
Business and startup grants are government funds given to your business to help it grow and stimulate the economy. The goal is to cover your marketing costs, encourage digitalisation, and help maintain competition in the evolving digital economy. The added benefit of using a business grant is that it is non-repayable.
Many startup businesses may start out their business using borrowed funds from friends and family, or even use their savings. But these funds are not always very reliable and may run out quickly.
When this happens, your plans for expansion and development can quickly be put on hold. The worst-case scenario is that your business may be shut down due to insufficient funds. With a truly good business plan, a government grant will help bring your company to new heights.
SME Digitalisation Grant
It's no secret that the business world is constantly changing as the digital world evolves. Many companies take to creating online platforms and websites to promote their business
That’s why the Malaysian government created the SME Digitalisation Initiative to create a digital Malaysia. This grant was officially launched on 17 February 2020 by the Ministry of Finance (MOF). They manage this grant along with Malaysia Digital Economy Corporation (MDEC), SME Bank, and Bank Simpanan Nasional (BSN).
The government offers a 50% matching grant going up to RM5,000 to SMEs that have the potential to digitise their companies. There are seven digitalisation services within this government grant for SMEs to choose from:
- Human Resource Payroll System / Customer Relationship Management (CRM)
- Remote Working
- Digital Marketing / Sales
- Enterprise Resource Planning (ERP) / Accounting and Taxation
- Electronic Point of Sale System (e-POS)
- Procurement
- E-commerce
In order to subscribe to any of the above services, the business should show how the service will help enhance its competitiveness and productivity over the period of five years.
This matching grant is limited to only one application per SME. However, the SME can apply to three digital services at most – so long as at least one service provider is endorsed by the MDEC.
The SME Digitalisation Grant will only be available to the first 100,000 small and medium-sized businesses. Or, it may end 5 years from the starting date of 17 February 2020. This will depend on which of the two come first. By then, the grant will be worth RM500 million, none of which is required to be paid back by the selected companies.
When you decide to go digital, it’s important to adopt cloud accounting software. This will allow you to manage your finances from anywhere and at any time. QuickBooks’ cloud accounting software works with a range of payroll, eCommerce, and point of sales apps like Salesforce and Shopify to improve your business.
Are You Eligible For The SME Digitalisation Grant?
If you are looking to apply for the SME Digitalisation Grant, it’s important to know the criteria for eligibility before starting the application process. Here are the encouraged attributes of potential applicants:
- Your SME or SME Cooperative should be at least 60% owned by Malaysians.
- Your company should be classified as an SME and registered under the relevant laws of Malaysia.
- Your SME/Coop must have been in operation for at least one year.
- For SMEs/Coops that have been in operation for one year, the company must have an annual minimum sales turnover of RM100,000.
- For SMEs/Coops that have been in operation for two years or more, the company must have an annual minimum sales turnover of RM50,000.
