10 tips to seizing the opportunity with WhatsApp this Ramadhan

Souq concept art generated by Bing Image Creator.

 

Ramadhan represents a significant opportunity for small and medium-sized businesses (SMBs) in Singapore, according to WhatsApp. With 65% of Singaporeans now messaging a business every week, messaging is the best way for people and businesses to get business done—from asking and answering questions to discussing products and finalising a purchase, the company said. 

Ten WhatsApp Business features to leverage include: 

- A full business profile

A complete WhatsApp Business profile with your description, category, address, and contact information instantly establishes credibility.

- Updated Ramadhan hours  

 Operating hours can change to accommodate iftar or prayer times. Updating business hours prevents frustration when customers send messages during non-operational times. 

- Automatic greetings  

An instant response ensures a customer’s message is acknowledged immediately, making customers feel valued even before you have had a chance to reply. To set up an automatic greeting message, go to the Tools tab and select Greeting message. Turn on Send greeting message to activate the feature. 

SMBs can also choose who receives the greeting by selecting Recipients and setting it to be sent to all customers or specific contacts.

- Sort the surge

Use Labels to instantly categorise chats by status (e.g., Paid - Ready for Shipping, Raya Hamper Enquiry, Iftar Menu) and add different colours to prioritise and manage increased volumes efficiently. Note that some businesses may now see Lists instead of Labels.

- Quick replies  

Stop typing the same answer repeatedly for frequently-asked questions like those related to pricing or delivery times. Create message shortcuts with Quick replies to maintain lightning-fast response times.

- Ramadhan catalogues  

Display all iftar packages, Raya hampers and limited-time bundles directly in the chat. A clear, visual catalogue lets customers shop and choose without leaving WhatsApp, leading to faster sales. And keep your products organised with Collections, so it’s easier for your customers to browse. 

- Flash sales

Customers love Status. Use it to create urgency and excitement by sharing limited-time discounts or last-minute iftar bundles.

- Click-to-WhatsApp ads  

Don't just generate chats—drive revenue. Utilise ads that click to WhatsApp to find high-potential customers on Facebook and Instagram.

- Meta Verified  

 Build confidence and authority with new audiences with a Meta Verified subscription. It not only safeguards brands against impersonation but also unlocks advertising and engagement tools. The verified badge can be prominently displayed across call tabs, business profile and context cards. 

- Business Broadcasts  

Send messages to multiple customers simultaneously. This capability can improve message response rates and strengthen customer relationships.

Indonesian SMEs to reach out globally via BukaGlobal

Indonesia-based Bukalapak has launched BukaGlobal, which connects the global market with more than 4 million Indonesian sellers, or pelapak. According to Bukalapak, it is the first Indonesian e-commerce platform to be available internationally, further advancing its mission to spearhead the digitalisation and internationalisation of small and medium-sized enterprises (SMEs) in Indonesia.

Fajrin Rasyid, Co-Founder and President of Bukalapak explains that BukaGlobal was designed to address logistics challenges in the region, such as high costs in postal and courier delivery*. "We want to break down barriers that hinder young and small entrepreneurs from competing on a global playing field, primarily on access, infrastructure, and connectivity. With BukaGlobal, Indonesian products are readily accessible by consumers anywhere in the world through a fast and reliable platform," said Rasyid during the launch.

Singapore is the first country that BukaGlobal is serving. Ngurah Swajaya, Ambassador of the Republic Indonesia to Singapore, explains, “The strong ties that has been established between Indonesia and Singapore, makes it the suitable market hub to introduce Indonesian products in the regional market field. This could be a proper strategy to advance the SMEs potential.”

According to a report by Bain & Company**, a huge middle class is rapidly emerging throughout developing Southeast Asia. Fifty million new consumers will join the ranks of the middle class in Indonesia, Malaysia, the Philippines, Thailand and Vietnam by 2022, contributing to the region’s US$300 billion in middle-class disposable income. The middle class will expand to include 350 million people and continue on its upward trajectory.

The Indonesian government is helping 8 million Indonesian SMEs to transform their business model. Rudiantara, Minister of Communication and Information Technology, Indonesia, stated in his remarks, “We feel that Bukalapak’s new initiative is aligned with the Indonesian government’s vision in both facilitating and accelerating export market expansion such as vocational programmes, the development of Internet infrastructure, along with business and entrepreneur workshops. We believe that when the collaboration happens between technology and traditional markets, progress will be seen and the path to lead the digital economy in Southeast Asia is clearer for Indonesia.”

Details:

BukaGlobal is currently available in Singapore, Malaysia, Hong Kong, Taiwan and Brunei Darussalam, with more markets onboarded soon. At the moment, only qualified sellers in Jakarta and Tangerang, Indonesia are able to offer BukaGlobal as part of their service, with more sellers to be involved.

Consumers in Singapore, Malaysia, Hong Kong, Taiwan, and Brunei can order products with weights starting from 0.5 kg with delivery times of approximately six to 11 days depending on the destination.

*International Trade Centre, New Pathways to e‐Commerce: A Global MSME Competitiveness Survey, 2017. (PDF) 
 
**Bain & Company and Facebook IQ. Understanding Southeast Asia’s Emerging Middle Class. Bain. (PDF).

12th WIEF all about empowering MSMEs

The 12th World Islamic Economic Forum (WIEF) is focused on empowering micro, small and medium enterprises (MSMEs) in order to facilitate their larger participation in the mainstream economy, in turn ensuring inclusive economic development, spurring innovation and improving efficiency. One such method of empowerment will be digitisation to facilitate their interaction with global economic players.

The empowerment motif is played out against the backdrop of a thriving global Islamic economy. Muslims are becoming increasingly active as investors and manufacturers, bankers and traders, competitors and suppliers, while Muslim consumer spending is rising for ethical finance, investment and insurance services, and for halal food, modest fashion and halal tourism. 

Key discussion topics that further the empowerment aim at the 12th WIEF include sukuk for infrastructure financing, integration of halal sectors and Islamic finance, expansion of the global halal food industry, development of the global modest fashion industry, improving funding access for MSMEs, integrating MSMEs into the digitised trade, building more equity crowdfunding platforms, spurring innovation by linking startups to corporations, and inculcating the culture of design-thinking for business. In addition, the forum will also host sessions on creative industries, Islamic travel and halal food markets. 

The 12th WIEF is organised by the WIEF Foundation and hosted by the Ministry of Finance, in collaboration with the State Secretariat and Ministry of Foreign Affairs, Indonesia. Over 2,500 delegates from 69 countries are expected to participate in this year’s Forum, including seven world leaders.

About 99% of Indonesia’s businesses are SMEs, with more than 98% being micro companies. These businesses employ over 107.66 million Indonesians and contribute 60.60% to Indonesia's GDP. In order to facilitate the growth and development of SMEs in Indonesia, the government recently issued several economic policy packages to stimulate inclusive economic growth. Some of them have direct impact on the interests of SMEs, such as simplification of permits for the establishment of SMEs and export licenses, increases in SME financing, and special interest rates on export credit.

Malaysia Debt Ventures launches shari'ah-compliant Bumiputera Technology Fund

Malaysia Debt Ventures (MDV), a wholly-owned subsidiary of the Minister of Finance Inc., in collaboration with Unit Peneraju Agenda Bumiputera (TERAJU), has launched the Bumiputera Technology Fund (BTF) for technology-based companies in an effort to facilitate their business expansion through shari'ah-compliant working capital and asset financing facilities.

The development of the new BTF programme is a step forward in the collaboration between MDV and TERAJU, which has helped to create a pipeline of quality and sustainable bumiputera* entrepreneurs. MDV and TERAJU are continuing the momentum with the new fund, totalling RM100 million. Bumiputera technology-based companies that are listed under TERAJU’s SUPERB and Syarikat Bumiputera Berprestasi Tinggi (TERAS) programmes are eligible for BTF funding..

Nizam Mohamed Nadzri, MDV’s Senior Vice President of Corporate Services said, “The BTF is envisaged to ensure a more comprehensive financing ecosystem for bumiputera companies, in particular, technology-based companies. The fund also targets to fill in the funding gap that exists for startups under SUPERB, as a follow-on funding programme to the grants received from TERAJU.”

He further explained that the BTF is a progressive proposition for MDV from the perspective of MDV’s dual mandate to provide development financing and nurturing to technology SMEs in a sustainable manner, particularly as the fund will fund graduates of the SUPERB programme who may require nurturing to achieve their goals.

Apart from improving access to finance, particularly for startups in the technology sector, the shari'ah-compliant fund also serves to fulfill customer demand for more diverse Islamic facilities.

“The BTF will intensify MDV’s contribution in further strengthening the Malaysian Government’s commitment to develop the Bumiputera Economic Community as well as to establish the country as an Islamic financing hub in the region,” said Nizam.

To be eligible for financing under the BTF programme, TERAS and SUPERB companies must be incorporated in Malaysia with a minimum paid-up capital of RM100,000 and possess viable projects that are within the technology space. Financing facilities offered will be from a minimum of RM500,000 to a maximum of RM5 million. All applications made for financing under the fund will be subject to assessment based on MDV’s credit risk criteria as well as risk assessment processes, which are geared towards financing technology companies and projects.

MDV was established by the government of Malaysia in 2002 to provide flexible, innovative credit financing to developing high-impact and technology-driven sectors of the economy, identified and prioritised by the government as future engines of growth. As one of the agencies in Malaysia solely focusing on technology-related sectors, MDV aims to be the leading technology financier in the country. Since its establishment more than a decade ago, MDV has financed numerous technology projects in various sectors as it strives to fulfil its mandate and developmental role in the technology industry.

*Also spelt 'bumiputra', the term typically refers to people of indigenous Malay ethnicity.

Phililppines senator asks government to strengthen MSME programme in ARMM

Senator Loren Legarda of the Philippines has underscored the role that micro, small and medium enterprises (MSMEs) play in generating jobs throughout the country, especially in poor municipalities.

Legarda, principal author of the Magna Carta for MSMEs, issued the statement following results of an online survey conducted by the Department of Labor and Employment (DOLE) and JobStreet.com Philippines, showing that three out of four locally employed Filipinos would accept jobs in their home region rather than work in another part of the country.

"I am glad that most of our kababayans (fellow Filipino) prefer working in their hometowns than move elsewhere in the country like Metro Manila, hoping to have better lives. This only indicates that Metro Manila is not the only place in the country where there's a multitude of job opportunities as more Filipino MSMEs participate on economic trade resulting to more jobs," Legarda said.

She added, "We need to sustain our gains by strengthening our MSME programmes because aside from generating employment opportunities and better incomes, MSMEs are powerful platforms for promotion of viable rural livelihoods, cultural preservation, socioeconomic empowerment of indigenous peoples, and environmental protection."

Legarda also called on the government to strengthen the country's MSME programme in the Autonomous Region in Muslim Mindanao (ARMM), which registered the highest number of residents who would rather find jobs outside of their hometowns, with only one out of three willing to stay and work locally, in order to spur economic growth particularly in the grassroots level.

The Senator also pushed for the promotion of green jobs and green skills in the country, noting that other nations encourage their people to engage in management in agriculture, forestry, horticulture, environmental information technology, and other careers that contribute to environmental preservation. All these efforts would complement our existing job generation strategies, she said.

Republic Act No. 9501, otherwise known as the Magna Carta for Micro, Small and Medium Enterprises, targets countryside industrialisation through the following: intensifying and expanding programs for training in entrepreneurship and for skills development for labor; facilitating access of MSMEs to sources of funds; assuring them access to a fair share of government contracts and related incentives and preferences; complementing and supplementing financing programmes for MSMEs and doing away with burdensome collateral requirements that small entrepreneurs find difficulty in complying with; instituting safeguards for the protection and stability of the credit delivery system; promoting linkage between large and small enterprises by encouraging the establishment of common service facilities; making the private sector a partner in the task of building up MSMEs through the promotion and participation of private voluntary organisations, viable industry associations and cooperatives; and establishing a feedback, grievance and evaluation mechanism.

QDB, ICD to collaborate on boosting SME sector

Source: ICD. The MoU was signed by (from left) Khaled Mohammed Al-Aboodi, the Chief Executive Officer and General Manager of the ICD, and Abdulaziz Nasser Al Khalifa, the Chief Executive Officer of QDB.

Qatar Development Bank (QDB) has signed a memorandum of understanding (MoU) with The Islamic Corporation for the Development of the Private Sector (ICD), the private sector arm of Islamic Development Bank (IDB) Group. The new agreement is a joint strategic collaboration in examining innovative means and opportunities to support small- and medium-sized enterprises (SMEs) in Qatar.

The MoU commits the two institutions to share knowledge and expertise relating to the SME sector in Qatar. A workgroup composed of key stakeholders and experts from each party will be formed in order to work on the feasibility of co-developing an investment and financing vehicle that will focus on supporting and developing SMEs and local businesses. The preliminary work to be undertaken by the joint parties will cover, although be not limited to, the following: concept design, market analysis, structure and governance, as well as potential positioning and product development. The MoU will enhance the ability of the organisations to achieve their respective objectives and mandates.

Abdulaziz Bin Nasser Al-Khalifa, CEO of QDB said: "Qatar Development Bank aims to empower local SMEs and entrepreneurs to help achieve Qatar’s National Vision 2030. Through this memorandum QDB will conduct a compatibility study for ICD programmes, and find the best applicable ways to utilise the findings in supporting the local SMEs, especially in providing funds to this important and vital sector, in order to develop the skills of the Qatari entrepreneurs and empower them to grow and compete successfully in the regional markets, in accordance with international standards."

Khaled Al-Aboodi, the CEO of ICD, said: “ICD and QDB share a mission of supporting the private sector, in particular SMEs. We look forward to enhancing our cooperation through this new and innovative initiative as there are great opportunities for local businesses to benefit."

QIB signs new Al-Dhameen Programme agreement

Source: QIB. Abdulaziz Bin Nasser Al-Khalifa, CEO of Qatar Development Bank (QDB), and Bassel Gamal, Qatar Islamic Bank (QIB) Group Chief Executive Officer, signed the Al-Dhameen agreement. The ceremony was attended by QDB officials Khalid Abdulla Al Mana, Executive Director of Business Finance and Jawaher Al Noaimi, Al Dhameen Programme Manager. QIB was represented by Tarek Fawzi, General Manager, Wholesale Banking Group, Mazen Al Thalathini, Assistant General Manager-Corporate Banking, and Basem Shahrouri, Head of Business Banking Division. 

Qatar Development Bank (QDB) has signed a new Al-Dhameen Programme Portfolio Agreement with Qatar Islamic Bank (QIB) for small and medium enterprise (SME) financing in Qatar. 

Al-Dhameen, which is sponsored by QDB, helps startups and existing companies with lack of collateral to obtain funds for growing their businesses. All main sector business activities are eligible for support under Al-Dhameen except the agriculture, fishing and livestock; non-oil mining and quarrying; wholesale and retail trade; financial and insurance, and real estate industries.

The programme does not provide direct finance to SMEs, instead offering the business owner access to the required finance from a partner bank in the form of guarantees in favour of the bank. Al-Dhameen guarantees 85% of the finance value not exceeding QR15 million). 

The Al-Dhameen programme was enhanced after feedback from partner banks and related parties, primarily to expand the base of beneficiaries, allow partner banks to determine which SMEs receive financing, and to fund them more flexibly. A record QR846 million in guarantees have been disbursed to over 348 SMEs since the beginning of the programme in 2010. 

The new QR100 million Al Dhameen portfolio aims to speed up approvals to guarantee the value of the funding provided by the partner bank to small and medium enterprises lacking sufficient guarantees. QDB has prepared a special portfolio guide that describes the terms, conditions, and international standards, due diligence, credit monitoring, applications and guidelines development, to help QIB to take the necessary decisions without referring to QDB.

Abdulaziz Bin Nasser Al-Khalifa, CEO of QDB said: "The Al Dhameen programme primarily facilitates financing to some of the most important sectors of industry, such as education, healthcare, and value-added services. The programme targets mainly companies and startups. We are delighted with this partnership with QIB, which (reinforces the priority) that all banks operating in Qatar have to support and develop the SME sector, diversifying the private sector and building a knowledge-based economy.” 

Bassel Gamal, QIB Group Chief Executive Officer said: “This agreement underscores QIB’s commitment towards supporting the country’s economy, by enhancing the role of the private sector and contributing to a suitable economic diversification as part of the Qatar National Vision 2030. It enables our existing and potential customers to get what they need swiftly and seamlessly, thus supporting the establishment of new SMEs and helping operating companies with their business expansion plans.

“We are proud of our strong ties with QDB, and we are committed to further enhance the mutual cooperation to achieve the agreement’s objectives which will contribute significantly in speeding up the process to provide financing solutions for SMEs. Supporting the SME sector is one of our top priorities, and for that reason, we have a dedicated programme, Aamaly, designed to cater for all the financial needs of SMEs in Qatar.”

Commercial Bank and Doha Bank are also partner banks for Al-Dhameen, having signed agreements with QDB in July 2015.

Interested?

SMEs can enquire about applications at the nearest QIB branch.

ICD and OJSC Agroinvestbank sign MoU for SME financing

Source: ICD. ICD signs MoU with OJSC Agroinvestbank for financing facility.

The Islamic Corporation for the Development of the Private Sector (ICD) and OJSC Agroinvestbank of the Republic of Tajikistan have signed a memorandum of understanding for cooperation to consider the extension of a financing facility to the bank as part of the allocation of US$25 million for Tajikistan.

The line of financing will be extended by OJSC Agroinvestbank to the SME sector for industrial, communication, technology, health, construction and agricultural projects. 

Khaled Al Aboodi, the CEO and General Manager of ICD, commented: “The small and medium sized enterprises (SMEs) have a crucial role to play in a country’s growth and development, and ICD has big plans for them. This is an important sector in all the member countries, including the higher income ones. ICD is now focusing on this sector by extending lines of finance to local banks in addition to the establishment of ASR Leasing Company in Tajikistan - a company specialised to provide shari'ah compliant leasing products to the SME sector.”

ICD previously extended a total of US$11.5 million in financing for the development of SMEs in Tajikistan which demonstrates ICD’s commitment to develop the private sector in its member countries.

The Chairman of OJSC Agroinvestbank said, "The close and mutual fruitful cooperation between Agroinvestbank and ICD positively affects the development of the economy of the Republic of Tajikistan through financing SMEs in key sectors such as agricultural, industry, construction and etc. The Islamic banking products have a huge potential to meet the increasing demand for long term financing of SME in Tajikistan. In this regard, the signing of present MoU is a step towards strengthening and deepening our further collaboration in context of development of the economy of the Republic of Tajikistan and enabling SMEs access to finance.”

IDB calls for working group to help develop Islamic finance for SMEs

The President of the Islamic Development Bank (IDB), Dr Ahmad Mohamed Ali, has called on OIC member countries and the World Islamic Economic Forum (WIEF) to establish a working group that will study and exchange expertise in utilising Islamic finance for the development of small and medium sized enterprises (SMEs). President Ahmad was speaking in Kuala Lumpur, Malaysia to delegates of the 11th WIEF, which took place from 3 to 5 November 2015. 

“I suggest the immediate establishment of a working group, among OIC institutions and specialised business forums like WIEF, to study the ways and means of leveraging support by Islamic finance to SMEs, through research and exchange of expertise,” said the IDB President. 

“Likewise, the partnership financing, the core element of Islamic finance, is an important source of funding for SMEs that can provide opportunities for entrepreneurship, jobs creation and income generation.

“The growing sukuk industry at the global level gives a tangible evidence that Islamic finance will play a major role in development financing especially for large-scale infrastructure.” 

He stressed that the IDB Group is committed to providing solutions in the development of the requisite legal, regulatory, supervisory and shari’ah frameworks for the development of SMEs. He also called on all multilateral development banks and government institutions to work towards mainstreaming Islamic finance, especially in mobilising resources for the implementation of the sustainable development goals. 

Islamic finance key to helping SMEs grow

In his opening remarks at the International SMEs Conference, held within the framework of the G20 meetings taking place in Istanbul under the Turkish Presidency, the President of the Republic of Turkey HE Recep Tayyip Erdogan praised the Islamic Development Bank (IDB) Group for supporting the Islamic banking industry in Turkey, noting that the Group contributed US$570 million this year to finance the construction of the country’s Vakifbank, and to provide a credit line to the Export Credit Bank of Turkey to promote SMEs in Turkey and support their competitiveness in global markets.

Said IDB Group President, Dr Ahmad Mohamed Ali: "SMEs create jobs and foster growth, contribute to political stability and make a significant dent
on poverty in every country. Statistics show that SMEs contribute to an estimated 43.5% of the total job opportunities created at international level, a figure that can increase to 57.8% worldwide.”

The IDB Group President also commended the Islamic Research and Training Institute (IRTI) and the World Bank’s Global Islamic Finance Development Center for their joint work that contributed to a flagship report, Leveraging Islamic Finance for SMEs. "I also envisage that this report will bring significant benefits to G20 constituencies, as well as other developing countries, who are interested in leveraging the Islamic financial services industry for stimulating SMEs,” Dr Ahmad said.

“The major challenge faced by SMEs is access to financing. The need to deal with this challenge better highlights the significance of recognising the potentials of Islamic finance which can greatly contribute to development of SMEs as it helps in promotion of collective cooperation for the sake of production and investment.”

In his conclusion, Dr Ahmad called for the establishment of a working group to exchange expertise and develop innovative Islamic financial instruments.

The event was organised by the World Bank, the IDB Group, the Turkish Prime Ministry’s Under-secretariat for Treasury, as well as the country’s industrialists and businessmen's association (TUMSIAD). 

AirAsia creates synergy with Indonesia's PBMT

Source: AirAsia. The Letter of Intent (LOI) between AirAsia and PBMT Indonesia was signed by AirAsia Berhad CEO, Aireen Omar, AirAsia Indonesia President Director, Sunu Widyatmoko, and President of PBMT, Jularso. It was witnessed by AirAsia Group CEO, Tony Fernandes, AirAsia X Group CEO, Datuk Kamarudin Meranun and President Director of PBMT Ventura, Saat Suharto Amjad.

AirAsia and Perhimpunan BMT (PBMT) Indonesia have signed an agreement to support the development of productive communities in Indonesia with the aim of generating positive social impact.

Productive communities are where the impoverished are being engaged in productive activities, enabling them to sustain themselves and to improve their standards of living in the long-term. According to Indonesia’s Central Statistics Agency (BPS), as of September 2014, 27.73 million Indonesians or 10.96% of the country’s total population live below the poverty line. The development of productive communities is therefore pivotal to address such social issues.

AirAsia has established operations in five countries including Indonesia, Malaysia, Thailand, Philippines and India. The airline’s mission is to serve the underserved through low fares and extensive connectivity. PBMT is one of the largest shari'ah microfinance groups in the world, with the objective to eradicate poverty by developing productive communities in Indonesia through various financial products and services, economic empowerment programmes and social activities.

AirAsia Group CEO Tony Fernandes said, “We are pleased to enter into a collaborative partnership with PBMT Indonesia in developing productive communities. AirAsia and PBMT share similar values - to give hope, to realise dreams, and to create opportunities for everyone to improve their quality of life. AirAsia was established because we had a dream to democratise the aviation industry and today, we are making hundreds of millions of dreams come true. This collaboration reinforces our commitment to fostering socio-economic development in Indonesia, and is also one of our ways of giving back to the community in the market that we serve.”

“We will also explore other opportunities for PBMT members with other companies within our group such as Tune Hotels and Tune Money,” Fernandes added.

The President of PBMT Jularso said, “This collaboration will bring our productive community development programmes to the next level as the synergies created from the collaboration will open doors to new ideas, resources and opportunities. Furthermore, this collaboration will also allow both organisations to significantly increase their social impact, especially on micro and small enterprises and the underprivileged people.”

The partnership between AirAsia and PBMT will see both parties leverage on each other’s resources and market presence. AirAsia is today the largest airline in Asia serving more than 200 routes to over 100 destinations in 22 countries, while PBMT’s network is spread across Indonesia with more than 700 branches nationwide and a membership of more than 2.2 million consisting mainly of micro and small enterprises.

The collaborative agreement will include an opportunity for micro entrepreneurs under PBMT to promote and sell their products such as meals, drinks and merchandises on board AirAsia flights.

Members of PBMT will also be provided with the facility to travel affordably across AirAsia's extensive network. AirAsia’s low fares will enable PBMT members to further develop their business ventures, visit their relatives, and Indonesian workers in Malaysia to return home more often, resulting to a boost in intra-Indonesia travels.

Additionally, AirAsia will provide an opportunity for PBMT members to sell AirAsia’s products and services. In supporting this initiative, AirAsia will develop coaching programmes and training modules for the members of PBMT, including but not limited to product knowledge transfer, management workshops, brand forums and sales training. In doing so, AirAsia equips PBMT members with the necessary skills and knowledge to successfully and effectively grow their businesses.  

Bank Muamalat launches BizSTAR-I SME financial package

Islamic bank Bank Muamalat Malaysia has announced it will extend RM200 million in new financing to small and medium sized corporations by 2015 through Muamalat BizSTAR-I, a financial package based on the concept of tawarruq* with a combination of Property Financing-i Tawarruq and MCash-i products. This product is designed to cater for either financing or refinancing of business premises and to support SME corporations to own business premises.

Y.Bhg. Dato’ Hj. Mohd Redza Shah Abdul Wahid, Chief Executive Officer of Bank Muamalat  said, “As the economy becomes more sophisticated, so will the requirements of the SMEs. One of the major levers of growth for the SME sector is access to financing and financial institutions therefore have an important role in the ecosystem for financing to SMEs.

“Business premises financing products are amongst the most popular financing products for SMEs, having grown from RM87.1 billion in 2003 to RM217.2 billion in 2012.”

Key features of Muamalat BizSTAR-I:

• Business property financing package based on shari'ah concept of tawarruq with a combination of Property Financing & Mcash-i (working capital requirement).
• The product package is designed to cater for the purchase of business premises and to provide cash financing for customers’ working capital.
• Financing limit from RM150,000 to RM5 million.
• Margin of financing (MOF) of up to 105% where 90% is for property financing,
10% for an MCash facility (working capital) and 5% for moving cost related expenses (MCRE) which includes mortgage reducing term takaful and credit level term takaful, legal costs and valuation costs.
• Tenure of financing is a maximum of 15 years for property financing and five years for the Mcash facility and subject to review.
• Competitive profit rate spread for property financing.

Bank Muamalat has a network of 59 branches (including 6 kiosks), in addition to its electronic channel, encompassing i-Muamalat, the Bank’s Internet banking solution, and e-Muamalat, available at almost 240 locations, referring to its network of ATMs, CDMs, and CDTs.

*A discussion of tawarruq can be found here and here.