Stan­dard Char­tered, ADB in RM80m pact on fi­nanc­ing for SMEs

The Sun (Malaysia) - - SUNBIZ -

PETALING JAYA: Stan­dard Char­tered Bank Malaysia Bhd and the Asian Devel­op­ment Bank (ADB) have signed an RM80 mil­lion sup­ply chain fi­nance (SCF) agree­ment to pro­vide fi­nanc­ing to small and medium-en­ter­prises (SMEs) in Malaysia.

In a state­ment yes­ter­day, Stan­dard Char­tered said this part­ner­ship will en­able SMEs to gain bet­ter ac­cess to work­ing cap­i­tal through this pro­gramme at af­ford­able rates.

Worth not­ing is that this is ADB’s first sup­ply chain fi­nanc­ing agree­ment in the coun­try through a fi­nan­cial in­sti­tu­tion.

Stan­dard Char­tered Malaysia man­ag­ing di­rec­tor and CEO Ma­hen­dra Gur­sa­hani said this part­ner­ship is a sup­ply chain fi­nanc­ing that helps SMEs grow and fa­cil­i­tates the ac­qui­si­tion of raw ma­te­ri­als for the pro­duc­tion of goods that are sold to their cor­po­rate clients.

It is an ef­fec­tive ve­hi­cle to sup­port SMEs, which is an un­der­served mar­ket seg­ment. In Malaysia, SMEs ac­count for 97% of all en­ter­prises and 36% of gross do­mes­tic prod­uct (GDP).

SME bank loans make up an av­er­age of 11.6% of GDP and 18.7% of to­tal bank lend­ing in most of de­vel­op­ing Asia. This in­di­cates poor on­go­ing ac­cess to bank credit, which is a ma­jor bar­rier to the sur­vival and growth of SMEs.

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