Budget 2026 SME Grants & Loans Malaysia
Budget 2026, presented on 10 October 2025 under the MADANI framework, marks a record commitment to Malaysian SMEs with RM50 billion for business financing, including RM30 billion in SJPP government-backed guarantees. This guide covers all the grants, loans, and incentives announced for SMEs.
Quick Facts
Pro Tip
Budget allocations are typically disbursed through existing agencies like SME Corp, TEKUN, and CGC. Apply early as funds are often exhausted before year-end.
Key SME Financing Highlights
Total Allocation Breakdown
| Category | Allocation | Target Beneficiaries |
|---|---|---|
| SJPP Government Guarantees | RM30 billion | SMEs needing bank loans |
| BNM Special Funds | RM3.8 billion | Digitalisation, automation, green |
| Microfinancing (TEKUN/BSN) | RM3.2 billion | Micro enterprises |
| EXIM Bank Facilities | RM10 billion | Export-focused SMEs |
| Women Entrepreneurs | RM270 million | Women-owned businesses |
| Youth MADANI Programme | RM150 million | Young entrepreneurs |
| Strategic Co-Investment Fund | RM200 million | SMEs and mid-tier companies |
| Startup Ecosystem | RM750 million VC + RM55 million Cradle | High-growth startups |
GGSM2 Enhancement (RM20 Billion)
The Government Guarantee Scheme for SMEs (GGSM2) continues as the flagship financing program with enhanced features:
What's New in 2026
- Extended guarantee coverage: Now up to 80% (from 70%)
- Higher loan ceiling: Up to RM20 million per SME
- Reduced guarantee fee: 0.5% p.a. (down from 1%)
- Expanded eligibility: Businesses with 1 year operation (from 2 years)
- Streamlined application: Single submission to participating banks
GGSM2 Eligibility
GGSM2 Requirements
- SSM registered business
- At least 1 year in operation (reduced from 2 years)
- Malaysian-owned (51% or more)
- Annual sales not exceeding RM50 million
- Not classified as impaired account by any bank
- Not in prohibited industries (gambling, weapons, etc.)
Microfinancing Programs (RM3 Billion)
Enhanced funding for micro enterprises through:
TEKUN Nasional (RM2 Billion)
- Loan amount: RM1,000 to RM100,000
- Target: Bumiputera entrepreneurs
- New features:
- Faster processing (7 days vs. 14 days)
- New digital application platform
- Mentorship program included
Amanah Ikhtiar Malaysia (RM1 Billion)
- Loan amount: RM2,000 to RM100,000
- Target: B40 and low-income entrepreneurs
- Enhanced programs:
- Higher loan limits for proven borrowers
- Business development support
Digital Transformation Grants (RM500 Million)
New grants specifically for SME digitalization:
SME Digitalization Grant
| Component | Grant Amount | What It Covers |
|---|---|---|
| E-commerce Adoption | Up to RM5,000 | Online store setup, marketplace fees |
| Cloud/SaaS Solutions | Up to RM5,000 | Accounting, CRM, inventory systems |
| Digital Marketing | Up to RM3,000 | SEO, social media, digital ads |
| Cybersecurity | Up to RM3,000 | Security tools, assessment |
| POS Systems | Up to RM5,000 | Point-of-sale equipment |
Total matching grant: Up to RM5,000 per SME (50% matching)
How to Apply
- Register at SME Corp portal
- Select approved service providers
- Submit quotation and business documents
- Receive approval within 14 days
- Implement solution and claim reimbursement
Pro Tip
Digital grants are popular and typically run out fast. Apply as soon as the portal opens (usually Q1 2026).
Green/ESG Financing (RM2 Billion)
Special incentives for sustainable businesses:
Green Technology Financing Scheme (GTFS)
- Loan amount: Up to RM20 million
- Interest subsidy: 2% reduction on market rate
- Guarantee coverage: 60%
- Sectors: Renewable energy, energy efficiency, green buildings
ESG-Linked Loans
Banks offering preferential rates for SMEs meeting ESG criteria:
| ESG Achievement | Rate Discount |
|---|---|
| Environmental certification (ISO 14001) | 0.5% reduction |
| Social responsibility benchmarks | 0.25% reduction |
| Governance standards (internal audit) | 0.25% reduction |
| Combined ESG score above threshold | Up to 1% reduction |
Learn more about ESG financing
Halal Industry Development (RM1 Billion)
Dedicated financing for halal industry growth:
Halal Development Fund
- Certification costs: Grants up to RM30,000 for JAKIM certification
- Facility upgrades: Loans up to RM5 million at preferential rates
- Export support: Marketing grants for halal products abroad
- Training: Subsidized halal compliance training
Learn more about Halal financing
Women Entrepreneur Programs (RM1.5 Billion)
Enhanced allocation for women-owned businesses:
I-Fikrah Women Entrepreneur Fund
- Loan amount: Up to RM200,000
- Rate: Competitive rates with government subsidy
- Target: 100% women-owned businesses
Women Microfinance
- TEKUN Wanita: Special allocation for women
- AIM Women: Priority processing for women applicants
Women Entrepreneur Benefits
- Lower documentation requirements
- Priority processing for certain schemes
- Mentorship and networking programs
- Business training subsidies
- Childcare support integration
Export Development (RM800 Million)
For SMEs expanding internationally:
EXIM Bank SME Facilities
- Pre-export financing: Working capital for export orders
- Post-export financing: Bridge until payment received
- Export credit insurance: Protection against buyer default
MATRADE Grants
- Market Development Grant: Up to RM300,000 for international marketing
- Trade fair participation: Subsidized booth costs abroad
- E-commerce export: Support for cross-border online sales
Startup Ecosystem (RM1.2 Billion)
For high-growth technology startups:
MYStartup Fund
- Matching investment: Government co-invests with approved VCs
- Grant component: Non-dilutive funding for R&D
Cradle Investment Programs
- CIP SPARK: Up to RM150,000 for pre-revenue startups
- CIP IGNITE: Up to RM500,000 for early-stage scaling
Sector-Specific Allocations
Agriculture & Agro-Food (RM500 Million)
- Agrobank special financing
- Modern farming equipment loans
- Cold chain infrastructure funding
Manufacturing (RM1 Billion)
- Industry 4.0 adoption grants
- Automation equipment financing
- Quality certification support
Tourism & Hospitality (RM300 Million)
- Recovery financing extended
- Digital tourism adoption grants
- Sustainable tourism incentives
Tax Incentives for SMEs
Budget 2026 also includes tax benefits:
| Incentive | Benefit |
|---|---|
| SME tax rate | 15% on first RM150,000 (extended) |
| R&D double deduction | Extended to 2028 |
| Digital investment allowance | 60% capital allowance |
| Green technology incentive | 100% investment tax allowance |
| Training deduction | Double deduction for approved training |
How to Stay Updated
Track Budget 2026 Implementation
- Monitor SME Corp website for grant openings
- Follow Ministry of Finance announcements
- Register with participating agencies (TEKUN, CGC, MDEC)
- Join SME associations for early information
- Subscribe to bank newsletters for scheme launches
Application Tips
Pro Tip
Government funds often operate on first-come-first-served basis. Prepare your documents now so you're ready when applications open.
Documents to Prepare
Standard Documentation
- Latest SSM profile/business registration
- IC of directors/owners
- 6-12 months bank statements
- Business plan or proposal
- Financial statements (if available)
- Proof of business activity (invoices, contracts)
Frequently Asked Questions
Frequently Asked Questions
Get Help Navigating Budget 2026 Schemes
The variety of schemes can be overwhelming. We help SMEs identify and apply for the most suitable programs.
Disclaimer: Interest rates, loan amounts, and eligibility requirements shown are indicative and subject to change. Contact the respective bank or institution directly for the latest rates and terms. Last reviewed: January 2026.
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