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Teraju join hands with SME Bank to set up RM500m fund

July 6, 2012

PETALING JAYA: The Unit Peneraju Agenda Bumiputera (Teraju) will join hands with SME Bank to set up a new RM500 million loan facility to assist Bumiputera companies under the Teras programme, Minister in the Prime Minister’s Department Nor Mohamed Yakcop said.

He said the Teras Fund, as it is known, is aimed at facilitating the business expansion of high-performing Bumiputera companies and is slated to be open for application, next month.

Under the Teras Fund, which is open to Teras companies that fall under the small and medium enterprises (SME) category, SME Bank will offer a loan facility of up to RM20 million per company, to assist business expansion through working capital and asset buying financing.

“We will allocate RM150 million for the working capital lending, for which a company can borrow between RM1 million and RM10 million. The RM350 million allocated for the asset buying financing will enable a company to apply for a loan of up to RM20 million.

“We expect a good take-up response from about 130 companies currently under the Teras programme. This is because the loans will not have very strict collateral agreements, in contrast with commercial banks.

“If possible, we expect the loan to be fully disbursed within a year,” Nor Mohamed told reporters after chairing the meeting between Terajau and the country’s five economic corridors here today.

He said the loan facility could also encourage more companies to join the Teras programme and benefit from the given perks.

Teras, which aims to foster the greater involvement of Bumiputera companies in the country’s economic glory, is looking to have 1,100 companies under its umbrella by July 2014, the third year anniversary of the programme.

To date, there are 130 Bumiputera companies with good potential for growth, under the programme, which is also helping them to grow beyond local markets while facilitating access to business opportunities.

On another note, Nor Mohamed said RM500 million from the RM2 billion Mudahcara Fund will be divided equally among the five economic corridors.

They are the Northern Corridor Economic Region, Iskandar Malaysia, East Coast Economic Region, the Sarawak Corridor of Renewable Energy and Sabah Development Corridor.

Nor Mohamed said the fund, announced by Prime Minister Najib Tun Razak to assist Bumiputera companies, will have further outreach through the corridors.

“These corridors know better their local companies and expertise. It is only appropriate for them to encourage and enhance the take-up of this fund.

“The prime minister has also agreed to lower the minimum project cost to RM5 million from RM20 million, previously.

“This is because from the research done, most Bumiputera companies undertake projects worth between RM5 million to RM30 million,” he added.

The Mudahcara Fund was created through a collaboration between Teraju and the Public Private Partnership Unit, a division under the Prime Minister’s Department.

The fund is also part of the Dana Mudahcara worth RM20 billion, allocated by the government under the 10th Malaysia Plan.


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