Funding Societies, the largest unified SME digital finance platform in Malaysia and Southeast Asia, has strengthened its partnership with Credit Guarantee Corporation Malaysia Berhad (CGC) by launching a RM30 million Islamic SME Portfolio Guarantee (SME PG-i) Scheme. This initiative aims to accelerate the growth of Malaysian SMEs by facilitating easier access to financing.
Building on CGC’s initial RM10 million Portfolio Guarantee programme with Funding Societies, launched in April last year, the new SME PG-i scheme offers a higher allocation and enhanced features. It will provide working capital financing to a broader segment of underserved SMEs through Funding Societies’ leading Islamic digital financing solutions. Eligible SMEs will benefit from longer-term financing and preferential interest rates, the lowest among Funding Societies’ existing portfolios.
Kelvin Teo, co-founder and Group Chief Executive Officer of Funding Societies | Modalku, highlighted the importance of collaborative efforts in addressing the significant MSME financing gap. “The Securities Commission, in its Catalysing MSME and MTC Access to the Capital Market: 5 Year Roadmap (2024-2028), estimates that the MSME financing gap has widened to RM290 billion in 2022 from the earlier projection of RM90 billion. Stakeholders within the ecosystem must collaborate to offer innovative solutions that can better complement traditional financing sources. On this front, we are delighted to further strengthen our partnership with CGC with this additional tranche,” Teo remarked.
Teo added, “The Islamic SME Portfolio Guarantee Scheme is a continuation of Funding Societies’ product roadmaps to scale our Shariah-compliant proposition to support creditworthy Malaysian SMEs of all sizes to thrive, contributing to Malaysia’s leadership in Islamic finance and ambition to be a global leader in Islamic Fintech.”
Datuk Mohd Zamree Mohd Ishak, President and Chief Executive Officer of CGC, expressed satisfaction with the initiative. “In CGC’s pursuit to provide more MSMEs with access to financing, we launched a RM10 million PG in April 2023 with Funding Societies which has received an encouraging response from unserved and underserved Malaysian MSMEs. Given the success of the first tranche, I am pleased that CGC launched a second tranche of RM30 million in Islamic PG with Funding Societies. This initiative is in line with CGC’s 5-Year Strategic Plan 2021-2025 and meets our objectives to partner MSMEs through life stages by providing E2E financial offerings and becoming a digitally savvy organisation to propel the scale and speed of MSMEs’ impact.”
The SME PG agreement was signed by Wong Kah Meng, Group Chief Operating Officer of Funding Societies | Modalku and Co-Founder of Funding Societies Malaysia, together with Sean Tan, CGC’s Chief Business Officer. The signing ceremony was witnessed by Teo and Datuk Mohd Zamree.
This partnership underscores a significant step towards supporting the Malaysian SME sector, enhancing their access to much-needed financial resources, and driving sustainable economic growth in the region.
