12 August 2026 recent Governor's Special Address at the 31st CGC Awards

KUALA LUMPUR, 13 AUGUST 2026 —

**Malaysia Launches RM10 Billion Guarantee Scheme to Bolster SME Resilience Amid Global Uncertainty**

Speaking at the 31st Credit Guarantee Corporation (CGC) Awards, he emphasized that Malaysia’s economic resilience hinges on the ability of SMEs—accounting for 40% of GDP and nearly half of national employment—to adapt and thrive amid uncertainty.

The new **BNM–CGC Guarantee Scheme**, launched during the event, marks a shift toward a more scalable, market-based approach to risk-sharing. It targets microenterprises, startups, and firms investing in sustainability, innovation, strategic sectors, food security, and external resilience. The scheme complements existing support measures, including the RM5 billion **SME Stabilisation Relief Facility**, introduced to ease cash-flow pressures during disruptions.

Since its inception, CGC has facilitated over **RM103 billion in guarantees and financing** for more than **544,000 SMEs**, yet many viable businesses still struggle to access financing due to conventional credit assessment limitations.

Malaysia’s economic backdrop remains robust, with **5.4% growth in Q1 2026**, driven by resilient domestic demand, sustained investment, and a sound financial system. Unemployment fell to **2.9%**, while headline inflation stayed moderate at **1.6%**. However, external risks persist, and SMEs—critical to Malaysia’s productivity and competitiveness—face mounting pressures from higher input costs, supply-chain disruptions, and delayed customer payments. These challenges have intensified working capital strains, testing business resilience.

The governor highlighted the need for financing to evolve alongside SMEs, noting that traditional credit assessments often overlook viable businesses with limited collateral or credit history. “A young enterprise may have strong cash flows but lack credit history; an asset-light business may have credible prospects but limited collateral,” he said.

“These firms are not necessarily unviable—they may simply be less visible through a conventional lens.” Guarantees, he argued, can bridge this gap by enabling risk-sharing while preserving financial discipline.

Beyond the new scheme, BNM is collaborating with CGC and Syarikat Jaminan Pembiayaan Perniagaan—with technical support from the **World Bank**—to strengthen Malaysia’s broader credit guarantee framework. The goal is to improve coordination, targeting, and financial sustainability of guarantees, ensuring they align with evolving business needs. “Our objective is not simply to provide more guarantees but to enhance how they are designed, targeted, and evaluated,” Dato’ Sri Abdul Rasheed stated.

The governor outlined three critical areas for progress: **widening the financing frontier**, **assessing businesses holistically**, and **leveraging data responsibly**. Financial institutions, he urged, must extend support beyond familiar sectors to high-potential areas like climate transition, R&D, and technology adoption. “Guarantees can give lenders greater confidence to develop tailored solutions for these firms,” he noted. He also stressed the importance of using alternative data—such as cash flows, transaction records, and supply-chain information—to better assess viability.

Industry stakeholders welcomed the initiative. **Datuk Jessica Chew Cheng Lian**, BNM Assistant Governor, highlighted the scheme’s role in fostering innovation and sustainability. “This is about enabling businesses to take calculated risks while ensuring responsible financing,” she said. **Tan Sri Nor Shamsiah Mohd Yunus**, former BNM Governor, echoed the need for adaptive financing models, citing Malaysia’s SMEs as key drivers of economic transformation.

Regional implications are significant. As Malaysia advances toward a **high-income, sustainable economy**, SMEs must lead productivity gains and digital adoption. The guarantee scheme aligns with broader efforts to enhance financial inclusion, particularly for underserved segments like microenterprises and startups. However, challenges remain, including ensuring that guarantees reach the right firms without distorting market discipline.

Looking ahead, BNM’s focus will be on **scalability and sustainability**. The central bank is exploring ways to integrate guarantees with broader credit infrastructure, including stronger data analytics and early intervention mechanisms. “Resilience is not about standing still—it’s about renewal and adaptation,” Dato’ Sri Abdul Rasheed said, referencing his earlier remarks at the **Sasana Symposium**. “The same principle applies to SME financing.”

For Malaysia, the stakes are high. With global supply chains fragmenting and climate risks intensifying, SMEs must become more agile. The new guarantee scheme is a step toward that goal—but its success will depend on collaboration between policymakers, financial institutions, and businesses themselves. As the governor concluded: “Financing must evolve as fast as the businesses it supports.”

Related: Credit Guarantee Corporation (CGC) · Bank Negara Malaysia (BNM) · Dato’ Sri Abdul Rasheed Ghaffour · Kuala Lumpur