BANGI: The Malaysian GreenTech Corp is having a hard time convincing commercial banks to approve loans for companies wanting to embark on green technology projects.
Its chief executive Dr Nazily Mohd Noor is frustrated that local banks are not brave enough to finance green technology projects.
Most of the companies that applied for loans, have been given green certificates by the corporation, indicating that their projects are viable and can be successful if the necessary funding is provided.
“Initially, our job was to look at the technical aspects of the green projects and to issue green certificates. But now, we have become the middleman, assisting failed companies to secure loans from banks.
“That is why we haven’t reached our KPI (key performance indicator) yet. By right, we should have achieved it a long time ago,” he told Business Times in an interview recently.
Nazily said the RM1.5 billion soft loan pledged to the corporation, was to come from local commercial banks and two foreign banks but the banks have low risk appetite and sometimes, it takes a year to approve one loan. He said the RM1.5 billion must be given out to 140 companies by next December 31.
“So far, the most supportive commercial bank is AmBank. The two international banks under our panel – Kuwait Finance House and Sumitomo Mitsui Banking Corp (Japan) have not given out a single loan despite active discussions and giving our applicants hope,” he said.
Other local banks that have given out loans are the Hong Leong Bank, Bank Pembangunan, Bank Rakyat, RHB, Maybank, CIMB and Public Bank.
At present, only 17 companies have been given financing (amounting to RM266 million) while another 81 companies, which have been given green certificates, have failed to secure financing as they are unable to provide track records of their business.
“How are they to provide a track record? This is a new technology.
“Sometimes, we have to extend the validity of the certificate (because the green certificate is only valid for six months) to another six months.
“So that means one certification is only valid for a year with the extension. There are many companies that have been given certificates, and even after the certificates expired, they still haven’t got their loans approved yet,” he said.
Nazily said the corporation plans to seek the Prime Minister’s help to find an amicable solution.
“We are also looking at engaging foreign venture capitalists to fund our projects.”
He added that the corporation plans to suggest to the government to make it a one-stop centre, just like Biotech Corp, whereby the funding is given directly by the corporation and not by the private sector.