GUIDELINES FOR THE APPLICATION OF FINANCIAL ASSISTANCE UNDER THE

SERVICES SECTOR CAPACITY DEVELOPMENT FUND

_______________________________________________________

Introduction

The Services Sector Capacity Development Fund (SSCDF) was established by the Government
to reduce the impact of liberalization by building capacity and strengthening the competitiveness
of domestic service providers.

Objectives

• To enhance the capacity building of local companies facing intense competition

by the impact of liberalization;

• To enhance competitiveness of local companies especially sectors that have

been prioritised for liberalization;

• To encourage local companies to compete globally through mergers and

acquisitions, as well as participation in overseas projects; and

• To improve the productivity of the services sector.

Eligible Services

All services sectors may apply for the SSCDF, excluding financial, utilities and construction
sectors.

Eligible Applicants

• Registered services industry associations/professional bodies; or

• Companies/entities registered under the Companies Act 1965 or the Registration of

Business Act 1956 with at least 60 per cent Malaysian equity.

Qualifying Capacity Development Programmes

• Training/Outreach Programmes;

• Accreditation;

• Mergers and Acquisitions; and

• Upgrading and Modernisation

i. Training/Outreach Programmes

• Services industry associations/professional bodies/domestic service providers

are encouraged to utilize the fund for training/outreach programmes aimed at
 developing and enhancing capacities and capabilities of domestic services in the
context of liberalisation.

• Eligibility Criteria

- Eligible training/outreach programmes must be endorsed by the relevant

Ministry or Agency in charge of the development of the services sector.

- Programmes currently covered by existing training funds are excluded

from SSCDF.

- Trainees must be full time Malaysian employees.

• Form of Assistance

- Assistance will be provided in the following forms:

a) For programmes conducted by associations/ professional

bodies: a one-off grant subject to a maximum of RM500,000; and

b) For domestic service providers: a matching grant (1:1) subject

to a maximum of RM250,000.

• Disbursement

- For associations / professional bodies:

a) 50 per cent of approved amount to be disbursed upon

approval; and

b) The remaining 50 per cent of grant to be disbursed upon the

completion of the programme(s)

- For domestic service providers, disbursement of grant is on a

reimbursement basis.

ii. Accreditation

• Domestic service providers intending to obtain internationally recognised

accreditation are eligible to apply for assistance from the SSCDF.

• Eligibility Criteria

- The accreditation should be supported by the relevant

Ministries/Agencies/associations in charge of the development of the sector.

- Domestic service providers that have received other forms of

government financial assistance for similar accreditation are excluded from the
SSCDF.

• Form of Assistance

- Assistance will be provided in the form of a matching grant (1:1) subject

to a maximum of RM250,000.

• Disbursement

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 - Disbursement of grant is on a reimbursement basis.

iii. Mergers and Acquisitions

• Domestic SMEs intending to merge with other services providers to become

larger entities in order to enhance their productivity, skills and technical capabilities,
efficiency and service delivery may apply for assistance from the SSCDF.

• Eligibility Criteria

- Both parties must be Malaysian entities registered under the Companies

Act 1965 or the Registration of Business Act 1956.

- The transaction must be completed within 1 year from the date of

approval of the grant.

- The merged/acquired entity must be held for at least 5 years.

- At least 60 per cent of the equity of the merged/acquired entity must be

held by Malaysian.

• Form of Assistance

- Assistance will be provided in the form of a matching grant (1:1) on the

cost of the merger and acquisition subject to a maximum of RM250,000.

• Disbursement

- Disbursement of grant is on a reimbursement basis.

iv. Upgrading and Modernisation

• Services industry associations/professional bodies/domestic service providers

intending to upgrade and modernize their services with a view to enhance
competitiveness may apply for assistance from the SSCDF.

• Eligibility Criteria

- Qualifying expenditure includes the purchase of equipment and software

including development costs for the purpose of diversifying into higher value-
added activities, improving productivity and efficiency of service delivery.

• Form of Assistance

- Assistance will be provided in the following forms:

a) For programmes administered by associations/ professional

bodies: a one-off grant subject to a maximum of RM1,000,000; and

b) For domestic service providers: a soft loan on the cost of the

purchase subject to a maximum of RM500,000. The loan will be disbursed
under the Soft Loan Scheme for Services Capacity Development (SLSCD)
through the Malaysian Industrial Development Finance Bhd. (MIDF).

• Disbursement
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 - For associations / professional bodies:

a) 50 per cent of approved amount to be disbursed upon

approval; and

b) The remaining 50 per cent of grant to be disbursed upon the

completion of the programme(s)

- For domestic service providers, financing of up to 90 per cent will be

provided via soft loan.

Procedure for Application

Applications for grant should be made using SSCDF (09) Form, to be submitted to:

Director-General
Malaysian Industrial Development Authority (MIDA)
5th Floor, Block 4, Plaza Sentral
Jalan Stesen Sentral 5
50470 Kuala Lumpur
P.O. Box 10618
50720 Kuala Lumpur
Malaysia
(Attn.: Senior Director Services)

Applications for soft loan should be made using Loan Application Form and to be submitted to:

Malaysian Industrial Development Finance Berhad

Level 14, Menara MIDF
82, Jalan Raja Chulan
50200 Kuala Lumpur
P.O. Box 12110
50939 Kuala Lumpur

For enquiry, please refer to:-

Grant Applications

Business and Other Services Division

Malaysian Industrial Development Authority (MIDA)

No. Tel. : 03-2267 6723

No. Fax: 03-2267 6655
Website : http://www.mida.gov.my
Email : services@mida.gov.my

or

Soft Loan Applications

Malaysian Industrial Development Finance Berhad

No. Tel. : 03-2173 8888

No. Fax: 03-2772 1911

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Website : http://www.midf.com.my
Email : inquiry-feedback@midf.com.my