KUCHING: Funding Societies Malaysia has successfully disbursed RM300 million in Islamic business financing to more than 2,500 micro, small, and medium enterprises (MSMEs), underscore its commitment to empowering the MSMEs.
As the leading digital financing platform for SMEs in Southeast Asia, it has achieved this milestone through 8,000 Islamic investment notes since launching its comprehensive suite of Islamic products in June 2023.
Country head of Funding Societies Malaysia, Chai Kien Poon asserted that the significant achievement of surpassing the RM300 million disbursement goal in just one year and providing access to financing for more than 2,500 MSMEs, were well ahead of their targets.
“This underscores the interest and demand for both Islamic financing and investment products. Islamic financing already constitutes 15 per cent of our portfolio, and we aim to increase this to 50 per cent by 2025,” he said in a statement yesterday.
He stated that against the backdrop of rising inflation and operational costs, SMEs were pivotal to Malaysia’s projected four to five per cent gross domestic product (GDP) growth in 2024.
He emphasised the need for ongoing financial support for SMEs growth trajectory, fostering job creation and enhancing economic contributions.
“We are grateful for the support from partners like Credit Guarantee Corporation Malaysia (CGC), who collaborated with us on the Islamic SME Portfolio Guarantee (SME PG-i) Scheme.
“Malaysia Digital Economy Corporation (MDEC) has also played a vital role in developing our Islamic financing products through the Global Technology Grant Programme.
“Furthermore, SME Corporation Malaysia’s appointment under the Bumiputera MSMEs Financing Initiative (BMFI) underscores our commitment to a socially impactful outcome,” he said.
In light of this, citing the Global Islamic Fintech Report 2023/24 by Dinar Standard, Chai pointed out that the Islamic fintech market is poised to grow significantly, surpassing the broader fintech sector.
He said as Malaysia and Indonesia have emerged as Islamic fintech hubs, it will reflect a robust transaction volumes and market potential.
Chai added, the halal economy, valued at US$6.25 trillion as of 2022, continues to expand, with Malaysia leading in global rankings since 2012, according to the State of the Global Islamic Economy Report 2023.
“This highlights significant potential for Malaysian MSMEs in the halal economy to utilise digital Islamic financing solutions to support their growth initiatives.
“Therefore, as Funding Societies continues to expand across its five key markets in Southeast Asia, its focus remains on supporting underserved SMEs via its extensive range of short-term financing solutions.
“Looking ahead, Funding Societies aims to continue forging new industry partnerships to expand its outreach to underserved yet creditworthy SMEs. Collaborations between financial institutions, fintechs, and corporations are key to advancing the Malaysian economy,” he said.