Funding pact to help SMEs tap varsity research projects

SMALL- and medium-sized entrepreneurs (SMEs) will be able to increase their competitiveness by commercialising research and development (R&D) projects developed by local universities.

Funding, which has been a main deterrent for SMEs, will be made easier with the collaboration between Malaysian Technology Development Corp Sdn Bhd (MTDC) and Bank Perusahaan Kecil dan Sederhana Malaysia Bhd (SME Bank).

SME Bank signed a Memorandum of Understanding with MTDC and UKM Holdings Sdn Bhd, the commercial arm of Universiti Kebangsaan Malaysia, in Kuala Lumpur yesterday.

These agreements will enable SMEs, especially Bumiputera entrepreneurs, to identify the viability of new technology-based products and provide funding to develop them.

UKM Holdings executive director Associate Professor Dr Nik Ismail Nik Daud said this would pave the way for SMEs to "exploit" the expertise of universities, especially since there are numerous R&D projects that are ready to be marketed or are at their last stage of development.

MTDC, which is the leading integrated venture capital solutions provider, manages the Commercialisation of Research and Development Fund (CRDF) and the Technology Acquisition Fund (TAF), which provides financial assistance to technopreneurs involved in biotechnology, agriculture, information and communication technology, industrial and sea-to-space industries.

MTDC chief executive officer Azlin Alias said so far, RM70 million has been disbursed to 58 companies through the CDRF and TAF under the Ninth Malaysia Plan (9MP) which provides an allocation of RM242 million.

"In dealing with technopreneurs, we found that though grants are able to cover at least half of their financial needs, there was still a need for additional loans."

From 2002 until to date, MTDC has awarded grants to 130 companies, of which 75 were for CRDF. Under the 9MP, it has so far awarded CRDF grants to 46 companies and TAF grants to 12 companies.

SME Bank has developed six strategic partnerships through MoUs - CIMB Bank, Perbadanan Nasional Bhd (PNS), MARA, Perbadanan Usahawan Nasional Bhd (PUNB), Small and Medium Industries Development Corp (Smidec) and Bank Muamalat to provide end-to-end support for its customers.

SME Bank chairman Datuk Gumuri Hussain said through its SME guarantee scheme, as at August 31 2007, a total of 39 loans worth RM35.8 million have been approved through CIMB, and 19 loans totalling RM6.74 million through PNS.

In the case of MARA, six companies benefited while in the case of PUNB, nine companies benefited from the strategic partnership.

source: http://www.btimes.com.my/Current_News/BTIMES/Tuesday/Nation/rup2612.xml/Article/