COVID-19 is not a short disaster. It is unpredictable and comes with unforeseen challenges for small businesses. However, the government remains committed to fight this pandemic in an integrated manner with the cooperation and support of all parties to ensure the zero COVID-19 mission is achieved immediately. The way our entrepreneurs and SMEs operators view COVID-19 as a trigger for change is also equally important.
Based on the observation, almost all sectors were affected or closed due to the transmission of COVID-19. But among the worst affected by this disaster is the community of more than 900,000 small and medium enterprises (SMEs) nationwide. Their businesses, services, and enterprises are not in operation. Their average capital and cash flow no longer exists and even bear the commitment to repay various loans.
Life has to go on. Therefore, the SME community needs to accept this statement as soon as possible from remaining silent or deadlocked. They need to rearrange steps and strategies while adapting to new realities with the help of government guarantee. SMEs should start planning a new strategy and quickly establish a foothold to dominate the market. Government works hard to make sure SMEs could immediately generate sustainable cash flow.
One of the most important ways to ensure this is to provide government guarantee to SMEs. It helps to provide guarantees to SMEs in the country to assist small and medium enterprises (SMEs), especially those who do not have adequate collateral or do not have collateral or performance records to obtain credit access. This complements the Government’s efforts in promoting and developing important business sectors to generate the economy.
On top of the existing financial assistance, the government guarantees assistance to SMEs by protecting those with only a small amount of protection as well as unprotected credit facilities. Various government guarantee schemes are designed to help SMEs to obtain financing up to the required amount.
When the SMEs apply for a loan or any other government guarantee protected credit facility, the lending institution will lend the institution will process and make an assessment, and then outline the steps necessary to obtain a secured loan or credit facility as required. SMEs do not need to make a separate application. Government guarantee will provide confidence to the lending institution and allow the SMEs to obtain financing based on the viability of their business and maximize the value of the collateral offered if any.
The government guarantee is one of many methods to keep the business soaring during this tough period. Post-COVID-19 period, we will see many changes take place and the competition is expected to start at the starting line. The new opportunities will emerge as a result of the demand from these new needs and habits. These opportunities must be filled by SMEs and the government should help to enable them to prepare themselves and then take advantage of the golden opportunities that arise and eventually become successful SME leaders in the market.