Kuala lumpur: The Agrobank is hoping that the Business Financing Guarantee Scheme (SJPP) will continue to be enhanced under Budget 2026, given its positive impact on the economy, particularly in empowering micro, small, and medium enterprises (MSMEs) in the agri-food sector.

According to BERNAMA News Agency, Chief Executive Officer Datuk Tengku Ahmad Badli Shah Raja Hussin highlighted that sectors such as production, livestock, fisheries, agro-based manufacturing, and food security have strong potential for further development. He emphasized Agrobank’s commitment to support young entrepreneurs, particularly those lacking business management experience. The bank aims to train these entrepreneurs to scale their businesses, targeting groups such as women, the B40 income group, and graduates.

Under Budget 2025, the government continued the implementation of the SJPP with guarantees of up to RM20 billion to strengthen financing access for entrepreneurs facing collateral constraints. The agriculture sector is considered high-risk due to factors like unpredictable weather and geopolitical conditions. The SJPP scheme boosts confidence among banks and financiers to extend financing to this sector, especially for micro and small clients lacking collateral.

Tengku Ahmad Badli Shah revealed that various financial institutions participate in SJPP, with Agrobank having channelled RM5.3 billion in financing to entrepreneurs in the agriculture and food security sectors. This represents an exponential increase from previous years, where disbursements ranged between RM1 billion and RM2 billion, indicating growing interest among Malaysians in entrepreneurship.

Nearly 12,000 clients have benefited from SJPP financing through Agrobank, comprising over 8,000 micro and small entrepreneurs, with the rest from medium-sized enterprises. The scheme has also recorded a healthy repayment rate with a low non-performing loan (NPL) ratio, demonstrating its effectiveness in bolstering the resilience of agro-entrepreneurs.

SJPP provides guarantees of up to 80 percent of the total financing amount, proving highly beneficial for SMEs by supporting investment expansion, digitalisation, and job creation. The bank evaluates each financing application based on sales and profit records, though many small and micro traders lack proper financial records due to reliance on cash transactions. Under SJPP, Agrobank offers training to help clients adopt proper accounting and management systems, enhancing their financial management skills.