SME Bank Signs RM150 Million MOU with Sabah Development Bank & Collaborate with Majlis Ugama Islam Sabah to Empower SMEs in Sabah

Small Medium Enterprise Development Bank Malaysia Berhad (SME Bank) today signed a Memorandum of Understanding (MoU) with Sabah Development Bank Berhad (SDB) offering various financing packages and entrepreneur development programs worth RM150.0 million. During this event, SME Bank and Majlis Ugama Islam Sabah (MUIS) also exchanged Letter of Intent documents for the Asnaf entrepreneur development program in Sabah.

Among the initiatives stipulated in the MoU include SME Bank offering Financing Packages with SDB’s Guarantee and club deal financing facilities for large-scale projects for SME entrepreneurs especially in Sabah, sharing of resources and collaboration in implementing entrepreneurial development programs and promoting facilities provided by both parties.

Among the focused sectors in this collaboration are the industrial, tourism as well as manufacturing and trade activities under the agricultural sector which are in line with the thrusts of the Sabah Maju Jaya Roadmap 2021-2025. This collaboration is also one of the efforts to revitalise Sabah’s economic performance which is affected by the COVID-19 pandemic with the reopening of more economic activities in Sabah under the Phase 2 of National Recovery Plan.

SME Bank’s Group President/Chief Executive Officer, Aria Putera Ismail said, “SME Bank has long established its presence in Sabah and through the 3 branch networks (Sabah Regional Centre, Kota Kinabalu Enterprise Centre and Tawau Enterprise Centre) SME Bank has approved more than RM118 million in financing to 184 SMEs in 2020 and for 2021 until July, financing worth RM88 million has been approved to 150 SMEs.”

Aria added, "Today's collaboration is an initiative to enable SME Bank and SDB to offer a complete package to the SME entrepreneurs, particularly in Sabah. As a Development Financial Institution with a mandate to nurture and develop the nation's SMEs, it is important for SME Bank to expand its services network so that no SMEs are left behind in receiving assistance. SME Bank’s subsidiary, Centre for Entrepreneur Development and Research Sdn. Bhd. (CEDAR) will also offer suitable entrepreneurship and capacity development programs to further empower SME entrepreneurs under the SDB ecosystem.”

SDB Managing Director/Chief Executive Officer, Datuk Vincent Pung Yee Kiong said, “The collaboration between SME Bank and SDB is timely to support the initiatives by the Federal and Sabah State Governments in the SME sector. The SME sector plays an important role in the socio-economic development of the country, especially in terms of its contribution towards the GDP and employment. SDB would like to thank SME Bank for initiating this initiative and pioneering this collaboration. It is hoped that this first initiative will be the starting point for closer cooperation in the future.”

Datuk Vincent also said, “SDB is a development financial institution under the supervision of the Sabah State Ministry of Finance and SDB will continue to fulfill its mandate to meet Sabah's socio-economic development needs.”

 The collaboration between SME Bank and MUIS will see both parties working together to ensure the success of Asnaf Entrepreneurship Program, ISHRAF 2.0 which is expected to begin in October 2021.Through this collaboration, MUIS will select 10 Asnaf entrepreneurs to participate in the ISHRAF 2.0 Program. Participants will undergo in-class structured entrepreneurship training conducted by entrepreneurship training consultants and continuous coaching sessions for a year to ensure business development and socio-economic improvements of the participants, thus changing their status from zakat recipient to zakat payer.

ISHRAF is a program specially crafted by SME Bank for the development of Asnaf entrepreneurs and was first introduced in 2020 (ISHRAF 1.0). The formation of the ISHRAF Program is timely as many micros and B40 category Asnaf entrepreneurs have been severely affected by the COVID-19 pandemic. Apart from Sabah, the ISHRAF 2.0 Program will also be expanded to involve selected Asnaf entrepreneurs in five other states namely the Federal Territory of Kuala Lumpur, Negeri Sembilan, Melaka, Kedah and Perlis.

The MoU between SME Bank and SDB was signed by SME Bank Group President/Chief Executive Officer, Aria Putera Ismail and SDB was represented by the Managing Director/Chief Executive Officer, Datuk Vincent Pung Yee Kiong.  For the presentation of Letter of Intent session between SME Bank and MUIS, MUIS was represented by Timbalan Yang di-Pertua, Ustaz Malai Ali bin Malai Ahmad and SME Bank was represented by Aria Putera Ismail. The signing ceremony and exchange of documents were witnessed by the Chief Minister of Sabah, Datuk Seri Panglima Haji Hajiji Haji Noor, the Sabah State Minister of Finance II, Datuk Seri Panglima Haji Masidi Manjun and Secretary of Sabah State, YB Datuk Seri Panglima Sr Haji Safar Untong.