SUMMARY ON AVAILABLE GRANT

Date of Meeting: 7 October 2020

Person Incharge: Umi Nadzirah Sumar (Asistant Director MIDA Melaka)
Muhammad Zaki Mohammad Ali (Asistant Executive SMEcorp)

DOMESTIC INVESMENT STRATEGIC FUND (DISF) FROM MIDA

1. INTRODUCTION

Establishment of a Domestic Investment Strategic Fund of RM1 billion to accelerate the shift of
Malaysian-owned companies in targeted industries to high value-added, high technology,
knowledge-intensive and innovation-based industries. The package of assistance will be
granted under the Customised Incentive Scheme, based on the request of the companies and
the merits of each case. The Fund aims to harness and leverage on outsourcing opportunities
created by Multinational Corporation(MNCs) operating in Malaysia; intensify technology
acquisition by Malaysian-owned companies; and enable Malaysian-owned companies to obtain
international standards/certifications in strategic industries. The Fund does not offer an outright
grant and is contingent on the investments of the applicant.

2. WHY DISF was established?

The establishment of this fund is part of the Governments ongoing efforts to further spur domestic
investment in realizing the targets of the national economic development plan. To strengthen
domestic investment as a complement to Foreign Direct Investment (FDI) in ensuring sustainable
economic growth in the future. The government places much emphasis on domestic investments
particularly the domestic SMEs as 98.5% of business establishments are SMEs, which contribute
around 40% of economic output and employ two-thirds of all workers in Malaysia.

3. INCENTIVES

The Domestic Investment Strategic Fund will provide matching grants (50:50), the fund will cater
for expenditures incurred for the following activities:

3.1. Training of Malaysians,

3.2. R&D activities carried out in Malaysia,
3.3. Modernisation and upgrading of facilities and tools to undertake manufacturing or
services activities for Multinational Corporations (MNCs) and Malaysian
conglomerates (outsourcing activities),
3.4. Obtaining international standards/certification,
3.5. Licensing or purchase of new/high technology.

4. ELIGIBILITY CRITERIA

4.1. Incorporated under the Companies Act, 1965 / Companies Act, 2016.

4.2. New companies in the manufacturing and services sectors with Malaysian equity
ownership of at least 60%.
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4.3. Existing companies in the manufacturing and services sectors with Malaysian equity
ownership of at least 60% undertaking reinvestments (expansion / modernization /
diversification).

4.4. Companies producing promoted products / engaged in promoted activities in the

following priority sectors:

A. Manufacturing

(i) Aerospace;
(ii) Medical Devices;
(iii) Pharmaceuticals;
(iv) Advanced Electronics;
(v) Machinery and Equipment;
(vi) Other industries, on a case by case basis.

B. Services

(i) Design and Development

(ii) Research and Development
(iii) Testing / Calibration
(iv) Quality and Standard Certification
(v) Architectural / Engineering Services
(vi) Technical and/or skills training
(vii) Logistics Service Providers (3PL)
(viii) ICT Solutions Providers related to Automation and Industry 4.0
(ix) Integrated Green Technology Project

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 DISF ENHANCEMENTS UNDER PENJANA

INTRODUCTION

The enhancement of DISF intends to assist Malaysian companies who are currently facing challenges
in their operations especially global supply chains disruptions due to COVID-19 pandemic. The
initiatives are as follows;

 Second Round of DISF Grant

Companies who have been approved for DISF grant can be considered for a second round of DISF
grant provided the recipient companies have utilized and claimed at least 50% of the approved grant
amount.

 Additional Eligibility Sectors/Scope of DISF Grant

Under the enhanced measures, the existing scope has been expanded to include industries in the
ecosystem of sectors classified as for National Importance and products/activities listed under the List
of Promoted Products/Activities for small scale companies under the promotion of investment Act (PIA),
1986.

 Reimbursement Ratio of DISF Grant

Training grant reimbursable ratio to be increased to 70% borne by Government, 30% borne by
Company subject to maximum amount of RM500,000.00 for each company.

 Effective Equity

The effective equity has been reduced from at least 60% owned by Malaysian to at least 51% owned by
Malaysian.
 INDUSTRY4WRD INTERVENTION FUND
(COLLABORATION BETWEEN MIDA & MITI)

1.0 INTRODUCTION
1.1. The Industry4WRD Intervention Fund is a financial support facility for Malaysian Small and
Medium Enterprises (SMEs) in the manufacturing and related services sectors to embrace
Industry 4.0.

1.2. The Fund will be provided to support companies in implementing intervention projects based
on the recommendation of Industry4WRD Readiness Assessment (RA) Report on the shift
factors of people, process and technology.

1.3. Objectives of this Fund are to:

1.3.1. Improve productivity of the company;
1.3.2. Accelerate business growth through adoption of Industry 4.0 technologies and
processes; and
1.3.3. Improve the current level of scoring based on the Industry4WRD RA undertaken.

2. ELIGIBILITY

2.1. This Fund is eligible for all SMEs in the manufacturing and related services sectors which
have completed the government-funded Industry4WRD Readiness Assessment (RA)
programme.

2.2. Company must adopt at least one of the following 11 industry 4.0 technology pillars:
 Big Data Analytics  System Integration
 Cloud Computing  Simulation
 Augmented Reality  Internet of Things (IoT)
 Cybersecurity  Autonomous Robots
 Additive Manufacturing  Advanced Materials
 Artificial Intelligence

3. SCOPE AND QUANTUM OF FUNDING

3.1. The funding will be provided on matching basis (70:30) based on eligible expenditures, up to
a maximum grant of Ringgit Malaysia Five Hundred Thousand (RM500,000.00) only.
 3.2. Only expenditures based on the recommendations of RA report will be considered. At
least one of the shift factors of people, process and technologies must be addressed in
the intervention project, subject to a maximum grant of RM50,000 on the shift factor of
people.

3.3. The following expenditures will not be eligible:

3.3.1. Purchase or rental of land, building, vehicles and furniture;
3.3.2. Premise renovation;
3.3.3. Collateral or loan for any purpose;
3.3.4. Marketing/ promotional activities;
3.3.5. Operation expenditure including salary, employee benefits,
travelling expenditures;
3.3.6. Expenditures on R&D activities; and
3.3.7. Working capital not related to the project.

4. NOTIFICATION OF RESULTS

4.1. Successful applicants will be approved a maximum 30% upfront payment of the 70%
matching grant. Amount of upfront is subject to decision by the Industry4WRD
Intervention Fund Approval Committee (based on the company’s financial status). The
balance of the remaining grant will be disbursed upon progress of the proposed project
by:

Prepared by, Check by,

……………………… ………………………..
Muhd Zulfitri Zulkarnain Farhana Mokhtar
Eksekutif R&D Senior Eksekutif R&D
Table of Available Grant

No GRANT FROM INCENTIVES AMOUNT

1 Modernisation
/Upgrading of facilities
and tools to undertake Fund will provide
Domestic Invesment MIDA manufacturing or service matching grants
Strategic Fund (DISF) activities for (50:50)
Multinational Company.

2 Companies who have

been approved for Fund will provide
DISF grant can be matching grants
DISF Enhancement PENJANA considered for a (70:30)
second round of DISF
grant.
3 Accelerate business
growth through
adoption of Industry
Fund will provide
4.0 technologies and
matching grants
Industry4WRD Intervention MIDA processes; and (70:30)
Fund & MITI Improve the current
level of scoring based
on the Industry4WRD
RA undertaken.
4 Bumiputera Enterprise SMEcorp Product Development Fund will provide
Enhancement Program & Innovation matching grants
(BEEP) Productivity & (60:40)
Automation Max at
Brand Development RM200,000.
5 Green 5s Sirim STS Helps companies to Fund will provide
achieve GMP & Halal matching grants
certificate. (80:20)

Total cost
RM38500
6. Consultancy Progam Sirim STS To guide organization Fund will provide
(GMP, HACCP, HALAL) to provide matching grants
manufacturing facilities (80:20)
that conform to GMP
requirements Total cost
RM100,000