8 Frequently Asked Questions About A Bumi Loan

Are you interested in applying for a Government Bumiputera Loan? Have you read all the requirements and criteria but still aren’t sure what you will need to apply? You’re not alone. Applying for a loan in Malaysia isn’t always easy, and there are a lot of things to think about. Many have applied for such loans in the past but feel intimidated when they begin the process. Well, we’re here to try and make this as easy as possible for you. Here are eight frequently asked questions about Bumiputera loans.

How does a Government Guarantee Bumi Loan work?

Government Guarantee Schemes help bridge the gap between SMEs and Finacial Institutions (FIs) by providing government guarantee loans to help companies get their bank loans approved.

Who can apply?

The first thing you need to know before applying for a loan is the eligibility requirements. To apply for this loan, you must be at least 18 years old and will need Bumiputera status for yourself and your company.

How do you define Bumiputera Status Company?

To get a Bumiputera status for your company, you will need to be a Malaysian Bumiputera citizen and own at least 51% of the shares in the company.

What is the financing tenure?

The loan tenure is up to 15 years or until 31st December 2035, whichever date comes first.

How much is the guarantee fee?

The guarantee fee for this government-backed loan is 0.75% per annum, payable upfront.

How much is the interest rate?

The interest rate is determined by what is agreed upon by you and the participating financial institutions. The profit rate for a Bumiputera loan is also considerably lower than a conventional loan.

What is the purpose of a Government Guarantee Bumi Loan?

The pandemic was a tough period for SMEs, leaving many companies needing financial assistance more than ever. This loan is there to assist Bumiputera entrepreneurs across a wide range of industries in achieving their business goals. The government allocated a financial scheme with a total budget of RM10 billion to SJPP to assist Bumiputera-owned businesses.

If you are a Bumiputera entrepreneur who is looking to expand your business, you may apply for the Working Capital Guarantee Scheme-Bumiputera (WCGS-B) under SJPP.

Why should SMEs opt for a Government Guarantee Bumi Loan?

A government guarantee Bumiputera loan is much more beneficial to SMEs. The government guarantee on Bumiputera Loan is a guarantee secured by the government. This means that the government will step in and pay off your loan if there is any default by the borrower.

As the government wishes to help aspiring entrepreneurs, this guarantee protects SMEs with insufficient funds. The guarantee fee for a Bumiputera Loan is also lower than that of conventional loans, which means you can borrow more with less money down. They also have lower interest rates than conventional loans, which means you will be able to save on your interest payment.

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