Informal sector receives financing boost through SPIN

PUTRAJAYA: The National Entrepreneur Group Economic Fund (TEKUN Nasional) yesterday launched the Informal Financing Scheme (SPIN) with an allocation of RM50 million to help informal sector entrepreneurs affected by the Covid-19 pandemic obtain funding.

The informal sector, according to the Department of Statistics Malaysia (DOSM), refers to groups of unincorporated informal enterprises owned by households, including informal own-account entities and production units of informal employers.

Entrepreneur Development and Cooperatives Minister Datuk Seri Dr Wan Junaidi Tuanku Jaafar said SPIN is expected to benefit 10,000 entrepreneurs who are not registered with the Companies Commission of Malaysia (SSM).

The target group will be eligible for financing of between RM1,000 and RM5,000 with a repayment period of up to three years based on a profit rate of four per cent per annum.

“These informal entrepreneurs are particularly affected by the Covid-19 situation because most of them depend on daily wages and do not have much savings to sustain or the capital to move on to new businesses,” he told reporters after launching SPIN here yesterday.

Although just launched, he said Tekun Nasional has already channelled funding amounting to RM6.1 million under SPIN to 842 entrepreneurs since last November.

To qualify for SPIN, Wan Junaidi said applicants must be Malaysian citizens with proof of owning a business, whose premises will then be visited by Tekun Nasional representatives.

“For example, if they do business online, there is a record of the account, regardless of the period they have been in business. We do not place a lot of conditions because too many conditions does not help but will be an impediment to the people,” he said.

Based on DOSM data, he said there were almost 1.26 million employers in the informal sector with 71.7 per cent of the total being self-employed or operate micro-businesses. — Bernama