Soft Loan Scheme
A soft loan is a loan with a below-market rate of interest or have lenient terms (such as extended repayment periods) and fast approval. Interest rate is between 4% – 8%. Soft loans are usually provided by governments to projects that meet nation’s objectives such as promoting the development of small and medium enterprises.
Use of Funds
- Project financing (up to RM5 million)
- Acquisition of fixed assets (up to RM5 million)
- Working capital financing (up to RM3 million)
Source of Fund
- Government of Malaysia
- Registered under the Companies Act 1965 or Registration of Business Ordinance 1956
- At least 60% equity held by Malaysians
- Possesses a valid premises licence
- Manufacturing Sector – Sales turnover must not exceed RM50 million or full-time employees 200 workers or less.
- For Services and Other Sectors – Sales turnover must not exceed RM20 million or full-time employees 75 workers or less.
- Land & building (up to 25 years)
- Plant & machinery (up to 7 years)
- Working Capital
- Purchase Revolving Credit & Sales Revolving Credit (up to 150 days)
- Term Financing (up to 3 years)