Kuala lumpur: The non-performing loan (NPL) rate for the guarantee scheme under Syarikat Jaminan Pembiayaan Perniagaan Bhd (SJPP) remains low at around two per cent in line with the growth of small and medium enterprises (SMEs). It also reflects the manageable level of risk despite the significant increase in financing guarantee allocations under Budget 2026.
According to BERNAMA News Agency, Finance Minister II Datuk Seri Amir Hamzah Azizan stated that the expansion of the credit guarantee scheme was implemented cautiously through close collaboration with financial institutions to ensure that fiscal risks remain under control and long-term financial discipline is maintained. "Loan screening is carried out by financial institutions and scheme implementers, and so far the non-performing loan (NPL) rate has remained low, around two per cent, which is at a manageable level," he noted during the launch of the Budget 2026 initiative - Provisions for the Business Financing Guarantee Scheme and the Housing Credit Guarantee Scheme.
Under Budget 2026, the government has allocated financing guarantees through the Business Financing Guarantee Scheme with a higher total amount of RM30 billion, aimed at driving the growth of SMEs and the MADANI Economy. Of this amount, RM10 billion is specifically allocated for bumiputeras, with the government anticipating increased engagement due to the allocation.
Amir Hamzah highlighted that to support the development of the country's halal industry, the financing guarantee for halal SMEs has been increased to RM2 billion, expanding access to capital for entrepreneurs in the sector. Additionally, export-oriented mid-tier companies and businesses in the high-value industrial sector have each been allocated guarantees of RM5 billion.
Despite the increased guarantee allocation, Amir Hamzah emphasized the importance of proper implementation of the loan screening process and ongoing support for SMEs to ensure they comprehend the financing structure and requirements of sound financial management. He noted the decline in the uptake of SME-related schemes last year was due to the challenging global economic environment and more cautious investor confidence, along with the government's previous decision to exclude mid-tier companies from the SJPP.
This year, mid-tier companies have been re-introduced following a larger allocation. Earlier in his speech, Amir Hamzah mentioned that to aid those with irregular incomes, the MADANI Government, through Budget 2026, has continued the Housing Credit Guarantee Scheme (SJKP) with financing guarantees of up to RM20 billion for first-time home buyers, aiming to assist more than 80,000 people through guarantees of up to 120 per cent.
The SJKP will also extend protection to contract staff and offer the MADANI Housing Credit Guarantee Scheme to help those without a fixed income own homes through selected financial institutions. Since the establishment of Syarikat Jaminan Kredit Perumahan Bhd at the end of 2007 until December 2025, it has approved guarantees for over 104,000 applications with total financing of RM25 billion. For the year 2025 alone, the scheme under the SJKP benefited more than 27,000 applications with a total approved financing of RM7 billion. From 2023 to 2025, a total of 88,000 first home buyers realized their dreams with a total financing of RM22.8 billion.
Amir Hamzah added that Malaysia's Gross Domestic Product (GDP) growth remains stable with a target of 4.0 to 4.5 per cent for 2026, factoring in the impact of global tariffs. The IMF has also revised its economic forecast to be more positive, indicating the better-than-expected resilience of the global economy, which provides confidence and predictability for investors to continue investing in Malaysia.