StanChart Saadiq aims 13% growth in SMEs

The bank feels obligated to leverage its network to facilitate growth of SMEs in the halal segment

by S BIRRUNTHA/ pic credit: StanChart Malaysia Facebook

STANDARD Chartered Saadiq Bhd (StanChart Saadiq), the Islamic banking arm of Standard Chartered Bank Malaysia Bhd, is expecting growth of about 13% in small and medium enterprises (SMEs) clientele this year under its halal business.

Its CEO Mohd Suhaimi Abdul Hamid said the bank has always been very confident in its SME segment as it continues to take the opportunity in helping entrepreneurs who have the aspiration to go global.

“We are very strong in our SME segment. Last year, we grew our SME numbers close to about 10% year-on-year and this year, we are expecting the same. The halal industry is amazing as you can see and it is a key platform to grow the economy, while the SMEs constitute about 95% of our local economy,” he told The Malaysian Reserve (TMR) after the launch of StanChart Saadiq’s “Halal360” in Kuala Lumpur recently.

He added that as a global Islamic bank, StanChart Saadiq feels obligated to leverage its network and reach to facilitate growth of SMEs in the halal segment.

During the event, StanChart Saadiq launched a Shariah-compliant proposition termed “Halal360” to support local businesses to thrive within the global halal ecosystem.

Financial incentives are granted to halal SME exporters in the form of attractive foreign-exchange (forex) rates on export proceeds, preferential pricing on current and savings accounts, and lower rates on business instalment financing programmes.

Through this, Malaysian SMEs and large corporations can gain access to the bank’s full suite of Shariah-compliant trade financing, liquidity management and working capital solutions to meet their local and cross-border requirements.

StanChart Malaysia MD and CEO Abrar Anwar said over the years, there is growing awareness of “halal tayyab”, which calls for Shariah compliance to be assessed throughout the entire supply chain of a halal business.

He added that this poses equally growing need for utilising Islamic financial services to ensure end- to-end Shariah compliance in the operations of halal businesses.

“By capitalising on the synergies between the halal industry and Islamic finance, we can foster a truly halal economy.

“As a bank, we have a deep obligation to help facilitate and contribute to Malaysia’s growth, in line with our purpose of driving commerce and prosperity through our unique diversity,” he said.

The global demand for halal products is expected to increase as the halal market has expanded from food and beverage products to cosmetics, pharmaceuticals, modest fashion and halal tourism.

According to a report by Thomson Reuters Corp, the global halal market size is projected to grow to US$3.1 trillion (RM12.93 trillion) by 2023, presenting ample opportunities for Malaysian companies to be part of the ever-growing market.

StanChart said one of the key challenges facing SMEs today are in terms of financing, especially cost saving when it comes to forex.

Bank Negara Malaysia reported that only 54.1% of halal businesses are bank-financed, and of this, less than a quarter is in the form of Islamic finance.

The Halal360 launch was also witnessed by the Entrepreneur Development and Cooperatives Ministry secretary general Datuk Wan Suraya Wan Mohd Radzi.

Speaking at the event, she said to achieve the spirit of a holistic halal economy that is ethical and sustainable, it is essential to ensure that Shariah compliance prevails in the entire product or service supply chain of an organisation.

“As a result, these Islamic values have a universal appeal, making many halal products and services equally attractive to both Muslim and non-Muslim consumers.

“In this regard, Shariah-compliant financing is key to completing operational integrity and unlocking new sources of ethical and economically viable funding,” she added.