Soft Loan For Automation and Modernisation (SLSAM)

The Soft Loan Scheme was launched in February 2007 to:-

i) encourage industries to modernise and automate their manufacturing processes;

ii) upgrade production capability and capacity; and

iii) assist companies in:-

      minimising dependence on labour-intensive activities and foreign labour;

      diversifying into higher value-added activities; and

      rationalising and streamlining their operations through mergers and acquisitions.

1. Eligibility: Companies incorporated under the Companies Act 1965 with:-

  • at least 60 percent equity held by Malaysians;

  • Possess valid business license; and

  • In operation for at least 2 years.

2. Sector Coverage:

  • manufacturing sector;

  • electrical and electronics;

  • wood products and furniture;

  • plastics and chemical products;

  • iron and steel;

  • textiles and apparel

  • automotive

3. Eligible Expenses:

  • Industrial Adjustment / Automation

     Purchase of new or reconditioned machinery and equipment;

     Purchase of software and computer peripherals related to the industrial adjustment process;

     Purchase of new machinery, plant and equipment for the purpose of diversification into higher value-added activities;

     Costs related to the installation, commissioning and related training as well as maintenance of the machinery; and

     Expenses related to undertake services related to mergers and acquisition (M&A) such as registration fees and payment for services by investment bankers.

* The above activities must result in a reduced number of foreign workers employed.
**For reconditioned machinery and equipment, the age must not be more than 5 years.

4. Minimum Loan Amount: RM100,000

5. Maximum Loan Amount: RM5.0 million.

6. Margin of Financing:

  • Up to 85% for new machinery and equipment.

  • Up to 60% for reconditioned machinery and equipment.

  • Up to 70% for services engaged by the company for the purpose of M&A. Payment will be made upon defrayment of 30 percent of its services cost.

7. Repayment Period: 5 to 7 years including grade period of up to 1 year.

8. Interest rate: 4% on yearly rest.



Posting date070907


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