Malaysia is trying to make cheap money do heavier lifting.
The government is rolling out up to 5 billion ringgit ($1.3 billion) in low-cost financing to help small and medium enterprises move beyond survival mode and into higher-value sectors such as technology, green projects, automation and tourism, according to remarks by Entrepreneur and Cooperatives Development Minister Steven Sim Chee Keong reported by Bernama.
The financing, priced at interest rates of between 3% and 5%, will be distributed through licensed banks, prescribed financial institutions and development finance institutions, including Bank Rakyat and SME Bank, Sim said at the launch of the “Heritage Brands of Penang” publication in Penang.
The latest funding forms part of the government’s broader PowerUp10K campaign, a year-long initiative aimed at strengthening SMEs at different stages of growth.
Under the programme, the ministry is targeting total disbursements of up to 15 billion ringgit in low-cost financing, higher than the previously allocated 10 billion ringgit.
Sim said the campaign aims to help 10,000 businesses scale up, while setting aside at least 100 million ringgit for capability-building programmes expected to train as many as 100,000 entrepreneurs.
The government also wants to raise SME value-added contribution to more than 750 billion ringgit ($189 billion) and support 100 local companies in reaching 100 million ringgit ($25.17 million) in revenue over the medium term.
He said SMEs, including heritage businesses, should make use of the financing facilities and other government-backed programmes to build resilience and expand over the long term.
As of February 2026, around 2 billion ringgit ($500 million) in financing had already been approved under the initiative, Sim said.
The push suggests Malaysia is becoming more deliberate in using subsidised financing not just as a cushion for smaller firms, but as a policy lever to steer them toward digital and greener industries.
The emphasis on automation, technology adoption and transition-economy activities also points to a broader goal: lifting SME productivity and making smaller businesses more competitive as cost pressures and regional competition intensify.