SMEs in Malaysia receive financial incentive to go digital

SMEs can receive up to a maximum of RM$5,000 to support their investment in digitisation, as Malaysia looks to speed up digital transformation.
By: | October 19, 2020
Topics: Compensation and Benefits | Digital Transformation | Malaysia | News | Restructuring

The Malaysian government has allocated RM$500 million (USD$120 million) in a bid to encourage SMEs in Malaysia to increase their investment in the digitisation of their daily operations.

Up to a cap of RM$5,000 (USD$1,206), SMEs will receive a grant that matches its spending. For example, if an SME were to invest RM$3,000 (USD$723) in digitisation, it will be entitled to a RM$3,000 grant, creating a RM$6,000 (USD$1,446) fund.

An SME that spends RM$10,000 (USD$2,411) however, would receive the capped amount of RM$5,000, topping up the total to RM$15,000 (USD$3,617).

To be eligible for the grant, SMEs need to be 60% owned by Malaysia, have been in operation for at least a year, and have an annual turnover of at least RM$100,000 (USD$24,113) for a year, or RM$50,000 (USD$12,056) with two years of operation or more.

READ: Malaysian businesses urged to accelerate digital transformation

Speaking earlier this year, Malaysia’s Entrepreneur Development and Cooperatives (MEDAC) Minister Datuk Seri Dr Wan Junaidi acknowledged the challenges SMEs are facing as they look to digitise their business.

He said, “These problems consist of issues such as high cost of digitisation, adaption of technology, providing infrastructure and proper digital usage skills to be implemented in their company’s operations.”