Malaysia launches RM1.2 billion Ikhtiar Merdeka initiative for small businesses

The Malaysian government has launched ‘Ikhtiar Merdeka’, a financing and grant initiative totaling RM1.2 billion to support micro and small enterprises (MSEs). Minister of Entrepreneur Development and Cooperatives, Steven Sim Chee Keong, stated that the move aims to strengthen the MSE sector, which constitutes approximately 95 percent of all businesses in Malaysia.

Under this initiative, micro-business financing facilities will be increased by RM1 billion, raising the total facility for 2026 from RM5 billion to RM6 billion. This includes RM100 million through TEKUN Nasional, with the remaining funds distributed via agencies such as Bank Rakyat and Amanah Ikhtiar Malaysia (AIM). Additionally, the ‘Geran Sejahtera MADANI’ provides RM200 million in grants specifically for small traders, including night market vendors and home-based entrepreneurs.

In light of upcoming fiscal planning, small business owners have expressed hopes that future budgets will continue to prioritize MSE needs. Entrepreneurs are calling for expanded funding, increased grants to help transition home-based businesses into larger workshops or factories, and wider dissemination of information regarding banking channels to ensure more small-scale operators can access available financial support.