Budget 2025: RM470 Mln In Financing Key To Supporting, Growing Women SME Entrepreneurs

KUALA LUMPUR, Oct 20 (Bernama) -- The allocation of RM470 million for financing funds aimed at supporting women-led micro, small and medium enterprises (MSMEs) will play a crucial role in assisting women entrepreneurs in securing working capital, acquiring assets, and expanding their business capacity to higher levels.

Federation of Malaysian Manufacturers (FMM) president Tan Sri Soh Thian Lai said that supporting such access to financing aligns with FMM’s efforts to promote the growth and sustainability of women entrepreneurs, driving inclusive economic development.

“We welcome the initiative of RM470 million in financing funds provided by SME Bank, Bank Simpanan Nasional, Bank Rakyat, and MARA, which FMM has been actively advocating,” he said in a statement. 

bootstrap slideshow

Soh also expressed appreciation for the RM3.8 billion allocation for SME digitalisation and automation loans.

However, he said it should be offered to SMEs at a low interest rate of two per cent to three per cent as many SMEs are still lagging behind their regional peers in terms of Industry 4.0 technologies adoption.

Small and Medium Enterprises Association (SAMENTA) Malaysia president Datuk William Ng also commended the government’s initiatives to lower the budget deficit and implement measures to reduce wastage, including merging redundant agencies and extending the subsidised funding and credit guarantees for SMEs. 

bootstrap slideshow

“In particular, the RM 3.8 billion for automation and digitalisation will be helpful, while the RM 650 million allocated to support women and youth entrepreneurs is an inclusive strategy.

“We are also particularly thankful for the matching grant for industrial training to be administered by TalentCorp, which will help to ease the talent crunch among SMEs while allowing more students to gain practical experience,” he said.

Commenting on the minimum wage increase from RM1,500 to RM1,700, Ng said SAMENTA agrees that the wages in Malaysia are too low, and more must be done to lift the wages of Malaysians.

However, he expressed concern that the minimum wage is coming at a time of compressed margin for SMEs and will be disruptive to their operations.

“SMEs in Sabah and Sarawak, in particular, will find it difficult to implement the minimum wage, and we can expect substantial job loss as a result of this new announcement.

“In urban centres, such as the Klang Valley, southern Johor and Penang, median wages are already far higher than even the RM 1,700 announced.

“Beyond job loss, we will see further wage compression among the M40, with foreign workers being the biggest beneficiary of the revised minimum wage,” he added. 

On the two per cent dividend tax, Ng said it would hurt SME owners disproportionately as the bulk of dividends will go to the SME owners, not some silent or random investor as in the case of listed companies.

“Many SME owners do not draw salaries, due to the tight cash flow experienced by most SMEs in recent years.

“As such, taxing them on dividends from income that is already taxed is not only a form of double taxation but will discourage SMEs from growing their business or turning in higher profits,” he said while urging the government to consider exempting SMEs from the two per cent tax on dividends.

Meanwhile, Funding Societies Malaysia country head Chai Kien Poon said as a leading financial technology (fintech) player in the country, the company is encouraged to see measures to support MSMEs to accelerate economic growth while remaining people-centric and focused on equitable distribution, sustainability, and high-quality development.

“Continued support for MSME digitalisation through initiatives like the Digital Matching Grant for SMEs and Digital Grant for Vendors is also essential.

“While some Malaysian SMEs are thriving by adapting to digital trends and evolving market demands, many still encounter significant challenges, particularly in accessing financing, managing costs, and navigating the increasingly digital landscape,” he said. 

To this end, Chai said Funding Societies Malaysia is continuously expanding product offerings and deepening engagement with businesses by better addressing their financial needs more effectively.

“This includes partnerships with agencies such as SME Corp, Unit Peneraju Agenda Bumiputera (TERAJU), Credit Guarantee Corporation (CGC), and Bank Pembangunan Malaysia Bhd (BPMB),” he added.

Paywatch Malaysia co-founder and president Alex Kim said Budget 2025’s emphasis on supporting SMEs through tax incentives, investing in digital infrastructure, and rolling out financial literacy programs nationwide is essential to keeping this momentum going and ensuring long-term resilience.

“As a company focused on financial well-being, we believe empowering individuals with better access to their earnings contributes to a more financially secure workforce.

“When people have greater control over their finances, it strengthens both consumer confidence and spending power -- key elements for sustaining economic growth,” he said.

-- BERNAMA