New measures provide more financial flexibility for SMEs in Malaysia
Additional measures introduced by the Malaysian government will enable more companies to retain their employees as COVID-19 movement restrictions continue to impact businesses, said Datuk Michael Kang, president of the SME Association of Malaysia.
He said, “Our survey shows that about half of SMEs still need help to recover. The wage subsidy extension will help those that need it. Our survey also shows that about 20% of SMEs will close down if there is no help at all. This will at least help half of them to continue their business.”
Malaysian Prime Minister Muhyiddin Yassin had earlier announced additional measures under the Kita Prihatin package aimed at helping the lower- and middle-income groups, as well as employees and micro-enterprises.
These include initiatives such as the RM$2.4 billion (US$750 million) Wage Subsidy Programme 2.0, which is expected to benefit about 1.3 million workers. Companies can apply for a wage subsidy of RM$600 (US$144) per employee each month, up to a maximum of 200 employees.
To qualify for the scheme, companies must prove that they are still registering a decline of at least 30% in sales compared to the previous year for the period of the recovery movement control order (MCO).
Companies will be able to apply for the Wage Subsidy Programme 2.0 from October 1 to December 31. This, said Kang, will enable more businesses to better manage their cash flow for the next few months and help them plan for their loan repayments.
He concluded, “This will make it easier for them to plan and talk to banks, especially those that need to reschedule and restructure their loans after the automatic loan moratorium ends.