Lim Guan Eng says Malaysian banks’ RM54.8b profit can fund MSME loan relief measures

KUALA LUMPUR, July 9 — The banking industry’s higher profits in 2025 show that banks can afford to provide more support for micro, small and medium enterprises (MSMEs), said Lim Guan Eng, who renewed his call for interest-free loans and a temporary loan repayment relief measure for businesses.

The Bagan MP who is also DAP’s national adviser said the banking sector’s profit before tax increased by RM6.5 billion, or 13.5 per cent, to RM54.8 billion in 2025 from RM48.3 billion the previous year, arguing that the industry should play a bigger role in helping MSMEs facing rising costs and economic pressures.

He was responding to a written parliamentary reply by Prime Minister Datuk Seri Anwar Ibrahim on July 6, which stated that cumulative financing to businesses continued to expand to RM438 billion by the end of 2025.

The reply also noted that available support included the RM5 billion Business Financing Guarantee Scheme (SJPP) and a RM5 billion guaranteed working capital loan facility under the SME Stabilisation Relief Facility, which opened for applications on May 15, 2026.

Lim, however, said increasing loan availability alone would not address the challenges faced by MSMEs, which he said were affected by the global economic slowdown and higher oil prices linked to the conflict in the Middle East.

He reiterated his proposal for banks to provide interest-free financing for the first RM50,000 of MSME loans and impose a one-year interest rate moratorium on existing MSME loans.

“Whilst more loans are indeed made available to MSMEs, the critical question is rising costs to MSMEs which have been adversely affected by the global economic slowdown and oil price hikes caused by the Middle East conflict,” he said in a statement.

Lim said the banking sector should move beyond focusing solely on profits and fulfil its corporate social responsibility by supporting MSME customers during challenging times.

“I will continue to press and try to convince the prime minister that banks must do the right thing not only for the survival of MSMEs but also on behalf of the economic health of the nation,” he said.