THE Malaysian Indian Network of Entrepreneurs Association (1MINE) looks to the government to provide grants rather than credit facilities in providing aid to small and medium-sized enterprises (SMEs) crippled by the Covid-19 pandemic.
Its president Datuk S Gopinath in welcoming the government’s Prihatin Rakyat Economic Stimulus Package (PRIHATIN) unveiled by Prime Minister Tan Sri Muhyiddin Yassin on March 27, said SMEs could not afford to face potential liabilities from credit defaults with their current financial burden.
“SMEs especially those newly registered which had commenced operations just before the Movement Control Order on March 18 to contain Covid-19 need financial injections that will not turn into a liability in future.
“It is highly hoped that the government will look into awarding grants for SMEs instead of credit facilities. This will be a far significant way to help their financial burden now,” he told Bernama.
The association has also offered to assist the government in reaching out to SMEs, such as acting as a platform to mediate data collection.
Business non-governmental organisations like 1MINE, according to Gopinath, could serve as referral centres to brief the target group on the Finance Ministry guidelines and application for aid.
“SMEs especially from the tourism sector, unless they are related to the F&B or healthcare industry, are struggling and earning zero income at this time. They make up a major chunk of the Malaysian economy and need a substantial financial uplift to keep going.
“Loans and credit facilities may help them to pay utility bills, rent, salaries and wages for now but it is not cost-effective as there are no income at all. It will become a liability that they will need to pay back years after business resumes as usual,” he said.
Meanwhile, Kuala Lumpur and Selangor Indian Chamber of Commerce and Industry president Datuk R Ramanathan in a statement said more should be done to assist small and medium industries (SMIs) and SMEs to cushion their business losses and survive the Covid-19 onslaught.
He suggested measures such as reducing corporate tax of SMEs, reducing foreign workers levy and work permit renewal payment and further reducing the TNB tariffs for commercial and industrial purposes.
“This has to be done as SMIs and SMEs are major contributors to Malaysia’s economy and serve as the backbone for the nation’s industrial goals,” he added. – March 29, 2020, Bernama
