Franchise Financing Scheme (SPF)

Introduction

Are you interested to get involved in the franchise business but lack the capital to continue your ambitions?

Do you need access to credit and credit guarantees for the right to expand your franchise MDTCC in collaboration with the Credit Guarantee Corporation has introduced FRANCHISE FINANCING SCHEME, specifically designed to help entrepreneurs who are interested to venture into the franchise business Through this scheme, entrepreneurs can get financing through financial institutions participating in the scheme.

Commercial Banks Involved

  • CIMB Bank Berhad
  • Maybank Berhad

Standard of Procedure
Borrowers must be registered with the ministry under the Franchise Development Programme. After receiving confirmation from the ministry, the application can be sent to the borrower’s financial institution for review and approval. The CGC will issue a letter of guarantee to pass the application.

Condition of Participation

  • Businesses owned or controlled by Malaysia
  • Businesses registered under the Companies Commission of Malaysia
  • The net asset value or shareholders’ funds not exceeding RM 1.5 million 
  • The amount of the existing loan not exceeding RM 7.5 million
  • The borrower must not have a bad record of loans to any financial institution or government agency
  • The borrower must be involved in direct and full-time business
  • Have a specific business location and valid permit / license

Total Loans

  • Maximum loan amount of RM 7.5 million. Approved loan amount will depend on the needs of the business.

Credit Facilities

  • Purchase of Assets
    • Term Loan
  • Capital Round
    • Overdraft
    • Trade Finance
  • Other facilities determined by the CGC from time to time

Interest rate

  • Do not exceed the LS % above the Base Lending Rate (BLR) lending institutions. Actual financing costs actually incurred by the borrower will be reduced by 2%
  • 6% in the ministry, through the CGC will pay the difference between the interest rate of the loan.

Guarantee Fee

Between 0.5% to 1% per year up to 80% guarantee cover for loans without collateral and 90% for loans secured

How to Apply

  • Until 8 years

Loan Period

Application for franchise financing can be apply by following four steps:

  1. Franchisor / Master Franchisee must be registered with the Franchise Development Programme
  2. Meet the conditions prescribed clan your application will be screened for CGC clan sent to the financial institution.
  3. CGC and financial institutions involved will examine clan processing applications
  4. Funding will be issued after the Letter of Guarantee CGC received by the financial institution.

Application must be sent to:

Credit Guarantee Corporation Malaysia Berhad
Level 13-16 CGC Kelana Business Building
Centre 97, Jalan SS 7/2
47301 Petaling Jaya
Tel: 03-7880 0088 Fax: 03-7803 0077
Website: www.iGuarantee.com.my


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