Violet: Are the interest-free loans for SMEs “empty talk”?

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By Emma Victoria

DESPITE the government promising to offer interest-free loans to small and medium enterprises (SMEs) to tide them over following the Covid-19 outbreak, there has been widespread complaints that the funds have yet to be disbursed. This leaves tens of thousands of businesses in the lurch.

Pending Assemblywoman Violet Yong said based on feedback, many SMES have been wondering if the promises made by the federal and state governments were just “empty talk”. This was despite the loans being approved and the letters of offer signed.

She said the federal and state governments had announced several types of interest-free loans targeted at SMEs affected by the Movement Control Order (MCO) and Covid-19 pandemic. They include the 0% Micro-i Kredit Perihatin with a maximum borrowing of RM75,000.00 under Bank Simpanan Nasional; and the Interest Free Soft Loan Scheme under Bantuan Sarawakku Sayang (BKSS).

“But, most of the SMEs did not benefit from these interest-free loan schemes. They are feeling helpless over the matter as they could not get any reply from the banks and cannot stop wondering whether these interest free loans are for real or just empty talk.

“Close to 40% of the SMEs were unable to sustain more than two months due to the loss of income. They have requested for immediate attention from the government to address their needs,” Yong said in a statement.

The assemblywoman said these SMEs are not asking for free aid from the government but borrowings to get them through during this difficult period.

She stressed that it is pertinent that the government be truthful and transparent by making known to the public whether these loans are still available and the number for those who have signed the letters of offer.

“Besides, the SMEs should be informed when the loan amount will be released, what caused the delay in disbursing the loan sums to the respective SMEs who had successfully applied for it and how many applications have been received, approved and rejected?

“The federal and state government must also disclose what is the total loan sum which has been granted to SMEs and if these interest-free loan schemes are still available and open for application?” she questioned.

Yong said to sustain and maintain the business workforce, it is crucial for the government to waste no time in playing politics but to ensure the interests of the SMEs are taken care of.

SMEs form two-thirds of workforce in the country and contribute almost 40 percent to the GDP. Based on records, Sarawak has 40,000 SMEs and make up over 75% of the state’s business sector.

She also said it is hoped that the Bank Negara Malaysia could also come out with full explanation whether the funds are still available.

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