Malaysia Grants vs Loans What’s the Difference

Malaysia Grants vs Loans: What’s the Difference?

When it comes to financing, there are two main options available: grants and loans. Though they may offer financial help, they have some distinct features from one another.


The grant is a form of non-refundable financial aid. This is issued by governments or other bodies to persons or corporations for a particular public purpose. Grants are different from loans, where one needs to repay the loans after the maturity period has ended.

There are various grants in Malaysia people can find use of. The Dana Impak constitutes one such grant which was introduced by Khazanah Nasional Berhad to enhance Malaysian economy competitiveness and build national resilience, and additionally providing socio-economic benefits and impact on the people. The Dana Impak is one of the main pillars in the Advancing Malaysia strategy and has an allocation of RM6 billion over the next five years for six main themes: Building Climate Resilience, Quality Health and Education for All, Food Security and Energy, Digital Society and Technology, Competing in the Global Market. Further, the fund has a SEMARAK framework to evaluate the social and environmental contribution of their investment.


Loan is a kind of financial aid, which should be repaid together with interest, at the expiry date of the funding period. Banks or other financial institutions provide loans to persons or entities for a particular cause, either personal or business. There are secured and unsecured loans with different interest rates.

There are some different types of loans in Malaysia for people and businesses. For instance, the targeted loan repayment assistance program for COVID-19 impacted individuals and small businesses or SMEs such as TRA – Targeted Loan Repayment Assistance. 


The table below summarizes the differences between grants and loans:

Basis for ComparisonGrantsLoans
MeaningFinancial aid awarded by the government for a specific purposeFinancial assistance provided by banks or financial institutions to the borrower, which is repayable after some time with interest
RepaymentNot requiredMust be repaid during the specified term or after maturity
InterestNo interest appliesInterest rate varies, depending upon the type of interest
AvailabilityGrants are not awarded easily to any person or entityComparatively, the availability is easy
FormCash and kindCash only
PurposeSpecified or authorized purposeAny personal or commercial purpose
RefundGrants need to be refunded, if necessary conditions are not metNo such refund

Exploring Available Grants and Loans for Your Venture

Exploring the available grants and loans can significantly fuel your endeavors. Here are notable grants:

NameTypeClaimable expenses
eTradeGrantmaximum RM25,000
Market Development GrantGrantmaximum RM300,000
Greater KL Live LabGrantmaximum RM70,000
Young Agroprenuer Grant (GAM)GrantGrant
CIP SPARKConditional grantup to RM150,000
CIP SPRINTConditional grantup to RM600,000
Change Upgrade Product (CUP)Matching grantmaximum RM60,000
Service Export Fund (SEF)Grant/ Matching Grantup to RM1.3 million
Gamelan 2022Matching Grantup to RM200,000
National Technology & Innovation Sandbox FundGrant/ Matching Grantmaximum RM4 million
Industry 4wardMatching Grantmaximum RM500,000
High Impact Product (HIP)Matching Grantmaximum RM200,000
Change Upgrade ProductMatching Grantmaximum RM60,000
Semarak Niaga – Low Carbon Transition FacilityMatching grant/loanup to RM10 million
Business Accelerator Programme (BAP 4.0)Matching Grantmaximum RM400,000
Malaysia Grand ChallengeMatching Grantmaximum RM15 million
SME LOANSoft Loanmaximum RM500,000
SME Automation And Digitalisation Facility (ADF)Loanmaximum RM3 million
Micro Credit SchemeLoanmaximum RM500,000
Business Accelerator Program (BAP) Soft LoanSoft Loanmaximum RM1 million
Halal Technology Development FundLoanmaximum RM4 million
Business Growth FundLoanmaximum RM10 million
Business Start-up FundLoanmaximum RM5 million
KONTRAK-I Financing SchemeLoanmaximum RM100,000
TEMANNITA Financing SchemeLoanmaximum RM10,000
Rural Economy Funding Scheme (SPED)Loanmaximum RM200,000
Special Business Financing Scheme for Women (DanaNITA)Loanmaximum RM150,000
Industry Value Chain Development Programme – (PRiN)Loanmaximum RM1 million
Express Contract Financing Scheme (SPiKE)/SPiKE GLCLoanmaximum RM1 million
Financing Scheme for Persons with Disabilities (OKU)Loanmaximum RM50,000
Financing Scheme for IPMA Graduates (SEMAi)Loanmaximum RM50,000
Technology Entrepreneur Financing Scheme (SPiM Tekno)Loanmaximum RM500,000
Kampung Baru Cina Financing (PKBC)Loanmaximum RM50,000
Low Carbon Transition Facility (LCTF)Loanmaximum RM10 million
All Economic Sector (AES) FacilityLoanmaximum RM5 million
Youth / MARA Educational Institution Graduate Entrepreneur Programme (PUTRA)Loanmaximum RM10,000
BSN Micro/I SemarakLoanmaximum RM50,000
Disaster Relief Facility (DRF) 2022Loanup to RM700,000
Rural Economy Funding Scheme (SPED)Loanup to RM20,000
Soft Financing Scheme for Automation & Modernisation (SFSAM)Loanup to RM20 million
Business Recapitalisation Facility (BRF)Loanup to RM5 million
Kampung Baru Cina Financing (PKBC)Loanup to RM50,000
i-Tekad ProgrammeLoanup to RM50,000
Jumpstart Financing SchemeLoanmaximum RM500,000
MARA Integrated Smart Auto (MISA)Loanmaximum RM1 million
Indian Community Entrepreneur Development Scheme (SPUMI)Loanup to RM100,000
Professional Financing Scheme (ProSPEC)Loanup to RM500,000
Micro Enterprises Facility (MEF)Loanup to RM50,000
SME Revitalisation Financing (SMERF)Loanup to RM250,000
Soft Financing Scheme for SMEs (SFSME)Loanup to RM5 million
Soft Financing Scheme for Digital & Technology (SFDT)Loanup to RM1 million
PEMULIH Government Guarantee Scheme (PGGS – SJPP)Loanup to RM50 million
Business In Transformation (PERNAS)Loanup to RM500k (Pre-Franchisor) and up to RM25k (Pre- Franchisee)
Mobile Business Financing Scheme (Mobile Business/Karavan)Loanmaximum RM500,000
Technical Entrepreneur Development Program (PUTEK)Loanmaximum RM500,000
MARA Entrepreneur Guarantee Scheme (SJUM)Loanmaximum RM2 million
Malaysian Chinese Women Entrepreneur FoundationLoanmaximum RM30,000

There are different forms of financial assistance that people and companies may use to meet their goals such as grants and loans. Grants, on the other hand, are offered interest free with no need for repayment while loans accrue interest after the loan term elapses. In Malaysia, there are some grants or loans that are available depending on the type of individuals and business.

While seeking financial help, you need to know the differences between grants and loans, and choose what option is the best one in your case.

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