More liberal approaches to financing needed, say SMEs

Free Malaysia Today

SME groups propose that credit assessment be enhanced and more products be offered to help them secure financing.   Read More:  https://www.freemalaysiatoday.com/category/nation/2024/05/21/more-liberal-approaches-to-financing-needed-say-smes/   Free Malaysia Today is an independent, bi-lingual news portal with a focus on Malaysian current affairs.    Subscribe to our channel - http://bit.ly/2Qo08ry   ------------------------------------------------------------------------------------------------------------------------------------------------------ Check us out at https://www.freemalaysiatoday.com Follow FMT on Facebook: https://bit.ly/49JJoo5 Follow FMT on Dailymotion: https://bit.ly/2WGITHM Follow FMT on X: https://bit.ly/48zARSW  Follow FMT on Instagram: https://bit.ly/48Cq76h Follow FMT on TikTok : https://bit.ly/3uKuQFp Follow FMT Berita on TikTok: https://bit.ly/48vpnQG  Follow FMT Telegram - https://bit.ly/42VyzMX Follow FMT LinkedIn - https://bit.ly/42YytEb Follow FMT Lifestyle on Instagram: https://bit.ly/42WrsUj Follow FMT on WhatsApp: https://bit.ly/49GMbxW  ------------------------------------------------------------------------------------------------------------------------------------------------------ Download FMT News App: Google Play – http://bit.ly/2YSuV46 App Store – https://apple.co/2HNH7gZ Huawei AppGallery - https://bit.ly/2D2OpNP  #FMTNews #SME #WilliamNg #Samenta

Transcript

00:00 [Music]

00:02 Small and medium enterprises are urging banks to move beyond their rigid approach

00:06 and become growth partners in assessing creditworthiness.

00:10 Small and medium enterprises association president William Ng

00:14 said the main challenges that SMEs face when seeking funding are timeliness,

00:18 availability of collateral, margin and additional costs such as fees and interest.

00:23 He said banks need to determine their own risk appetite

00:27 and develop innovative products for their market segments,

00:30 emphasizing the importance of transitioning from financing partners to growth partners for SMEs.

00:36 Ng also suggested banks assess SME creditworthiness by using data on current sales,

00:42 sales projections and real-time payment and supply chain information,

00:46 saying this would enhance credit scoring methods and better support SMEs.

00:51 Meanwhile, SME Association of Malaysia Secretary-General Chin Chi-Seong

00:56 said traditional banks' rigid lending criteria, collateral requirements and risk-averse approach

01:02 make it challenging for early-stage and innovative SMEs to get seed capital.

01:07 He said that using alternative data has the potential to improve credit assessment

01:12 and that could help to close the funding gap.

01:14 He said data such as transaction history, social media activity and utility payment history

01:20 could offer a comprehensive view of an SME's financial health,

01:24 particularly those that do not have a credit history yet.

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Transcript

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