2023 WINS for MSME’s – Malaysia Madani Revised Budget 2023
Last weekend closed with much anticipation. For many fellow Malaysians valid reasons to celebrate with the tabled revised Malaysia Madani themed Budget 2023. The revised Budget has seen a revision of RM 386.1 billion, a much higher allocation as compared to the previous 2023 Budget tabled in October 2022.
“Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim said Budget 2023 will focus on addressing the high cost of living, further strengthening the social safety net and enhancing the micro, small and medium enterprises (MSMEs) eco-system. He said the government will also examine ways and means to reduce market disruptions as well as streamline business processes through the adoption of high technology and digitalisation. Malaysia Madani framework is supported by six core values: sustainability, prosperity, innovation, respect, trust, and lastly, care and compassion. Source, Budget 2023: Budget 2023 revised up to RM388.1bil, GDP growth at 4.5%, The Star “
Being the key in driving Malaysia’s grassroots economy and employment, the backbone of Malaysia – Micro, Small, and Medium Enterprises (MSMEs’) is set to benefit from the revised budget. Malaysia Madani 2023 Budget has been tabled, seeing to the continuation and improvement of extensive support in emphasizing digitalization, as well as highlighting the necessity for integration of automation process flows starting from Micro businesses upwards. This shows the government’s commitment in setting the foundation to a tech-enhanced Malaysia.
WHAT ARE THE KEY TAKE-AWAYS FROM THIS BUDGET FOR MSMEs?
💡 Digitalization and Automation
RM1 billion in funds under Bank Negara Malaysia (BNM) to help micro, small and medium enterprises (SMEs) automate their processes to digitalize their businesses.
>> RM100 million under the SME digitalization scheme will be used to fund matching grants of up to RM5,000 to SMEs subscribing to apps to digitalize their businesses, such as point-of-sales systems, accounts or inventory management.
>> Govt to provide RM50 million in matching grants to encourage automation of plantation sector through use of robotics and artificial intelligence.
>> Govt to accelerate implementation of Jendela project as a national effort to provide internet network facilities.
>> RM725 million to implement digital connectivity in 47 industrial areas and nearly 3,700 schools.
💡 Grants and Incentives to spur SME growth, drive domestic investments
>> Syarikat Jaminan Pembiayaan Perniagaan to guarantee up to RM20 billion in loans from SMEs, with a government guarantee of up for 90% for companies in frontier tech, agriculture and manufacturing.
>> Investment incentives will be restructured towards tiered taxes based on outcomes, such as creating high-value jobs, including local firms in the supply chain and creating new industry clusters.
>> Khazanah Nasional and EPF to invest in innovative and high-growth local start-up companies with an investment value of RM1.5 billion.
>> RM100 million under Digitization Grant Scheme for SMEs and small vendors to support business automation and digitization; separately, there is a RM1 billion facility under BNM aimed at incentivizing SMEs to automate processes and digitalize operations.
💡 Tax deduction for MSMEs
>> A proposed reduction in taxation on MSMEs’ first RM150,000 income to 15% from 17% previously, which he added will enable 150,000 MSME
taxpayers to each save up to RM3,000. This is a revision from the previous Budget tabled in October 2022, introduction at RM 100,000 in
income
>> Individuals or companies donating to nonprofits undertaking grassroot sports development programmes will qualify for a tax cut of up to
10% on aggregate income.
Companies falling under MSME’s can now take this advantage to invest into Omnichannel or chatbots. Get a head start and reap the fruits of a growing customer base in the long run by laying a strong foundation for great customer service.
WHY IS THERE SUCH FOCUS ON MSMEs?
“The latest data extracted from the Department of Statistics, Malaysia (DOSM) on MSMEs landscape shows a growth of 5.2% per annum, translating to a total 1,226,494 MSMEs in 2021 which accounts for 97.4% of overall businesses in Malaysia. Microenterprises remain the largest contributor of the total MSME establishments of up 78.6% (964,495 firms), small-sized firms formed 19.8% (242,540 firms), and the balance 1.6% (19,459 firms) were medium-sized MSMEs. Source, Profile of MSMEs in 2016-2021, SMECorpMalaysia.”
💡 What are the different MSMEs breakdown by Sectors in 2021?
>> The Services sector by far is the largest contributor constituting a whopping 83.8%, followed by the construction sector at 8%, coming
in third; the manufacturing sector takes up 5.8% of MSMEs, whereas agriculture at 1.9% and the balance of 0.4% derive from mining and
quarrying.
With the above stats, it’s proven the key driver of the nation’s economy is the Services sector. All the more reasons for companies who fall within the microenterprises to pay close attention in enhancing your customer service in order to grasp potential clients. Seeing the competition should be fierce, when one belongs to the larger pie.
“Repetition makes reputation, and reputation makes customers.” – Elizabeth Arden
As the quote by Elizabeth Arden states, consistencies in your branding message is key to success. With automation of your CX services, your company is able to achieve that. Maintaining brand standards, even by the way of greeting and standard questionnaires, which can be done seamlessly by a Chatbot and WhatsApp bots integrated to your CX system will give your company more structure. Thus enticing your customer to have continued confidence, satisfaction and ultimately a successful customer retention.
WHAT IS THE NEXT STEP IN GROWING YOUR BUSINESS?
LAYING THE FOUNDATION IN CX SOLUTION.
It is worthy to note that with this revision, individuals that fall within the range of M40 who earns RM 100,000 and below will enjoy a 2% lower tax deduction. This amounts to additional disposable income of RM 1,300 per individual based on 2.4 million active taxpayers in Malaysia. The customer pool just got larger, which also means companies with the best tech capabilities in place might be able to draw the most benefit in a shorter period of time. Hence companies must take an active role in bolstering your Customer Service Solution.
How? By engaging with the right technology that helps support your customer service team, or agents alike in thriving in any environment, enabling swift collaboration to provide the best possible customer experience.
Either by virtual cloud-based contact center with an omnichannel, a solution that can elevate engagement, customer journeys and your business to greater success. For those who have yet to invest in a holistic CRM Solution, now is the time to ride the wave of change and opportunity. With the given revised budget of 2023, the ease of financial help such as grants offered by the Malaysian government made it possible to start implementing digitization and automation for CX solutions especially for companies belonging to MSMEs.
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