KUALA LUMPUR: Small Medium Enterprise Development Bank Malaysia Bhd (SME Bank) has introduced Vanigham Financing Scheme (VFS), a RM50 million financing facility aimed at empowering Indian micro and small enterprises in the country.
The scheme, introduced as part of SME Bank’s financial inclusion strategy, offers financing between RM100,000 and RM300,000 with a government-subsidised profit rate starting at 3.75%, one of the lowest in the market.
Applications for VFS are open until Dec 31, 2027, providing affordable financing for asset acquisition, commercial vehicles, and working capital, allowing entrepreneurs to scale their businesses, expand market reach, and enhance competitiveness.
Deputy Entrepreneur Development and Cooperatives Minister Datuk Seri Ramanan Ramakrishnan said MSMEs are key drivers of Malaysia’s economy, contributing RM613.1 billion in 2023. This year, they are projected to account for 45% of gross domestic product and 25% of total exports.
“Government-linked entities must actively support this sector, particularly in financing, to drive expansion. SME Bank’s launch of the VFS is timely, aligning with the Madani Government’s agenda to foster inclusivity, diversity, and a sustainable business ecosystem,” he told reporters at the launch of VFS today.
Following discussions with Prime Minister Datuk Seri Anwar Ibrahim, Ramanan said, the government approved an additional 1% subsidy on the profit rate to make financing more affordable.
He noted that VFS offers financing between RM100,000 and RM300,000, with profit rates ranging from 3.75% to 6%, supported by a 1% government subsidy.
“For businesses requiring less than RM100,000, alternative financing options are available. SME Bank also provides other financing programmes for those needing over RM300,000, including the Jaguh Serantau Programme, which offers up to RM10 million for exporters, and Contract Financing, designed for businesses in the supply and construction sectors,” he said.
Ramanan said the overwhelming success of similar financing initiatives highlights the strong demand for accessible SME funding.
“For instance, the Tekun Nasional financing limit was increased from RM30,000 to RM100,000 due to high demand, while SME Bank’s BriefEye programme was fully utilised within a short period, leading to additional funding requests. If demand for VFS exceeds expectations, the government will consider expanding the programme further,” he added.
Acting group president and CEO Datuk Dr Mohammad Hardee Ibrahim said VFS reflects SME Bank’s commitment to tailored financing for small businesses. “We recognise small entrepreneurs as key contributors to the SME ecosystem. Through VFS, we aim to encourage innovation and strategic entrepreneurship across Malaysia.”
The launch was officiated by Ramanan, alongside ministry secretary-general Datuk Seri Khairul Dzaimee Daud, SME Bank chairman Datuk Muslim Hussain and Hardee.
The scheme aligns with SME Bank’s other flagship initiatives, including the Jaguh Serantau Programme and HalalBiz Financing Programme, and complements National Budget 2025 strategies.
