Jamaludin: Banks need to nurture IT players
THE banking sector needs to once again play a nurturing role, to guide new players in the knowledge economy the way it did for the manufacturing sector, said Second Finance Minister Datuk Dr Jamaludin Jarjis.
“The new players now not only require funds to develop their businesses but also hand-holding in various aspects to succeed in business,” he said in a speech read by his deputy Datuk Dr Shafie Mohd Salleh at the launch of Malaysia Debt Ventures Bhd (MDV) Nurturing Services and Nurturing Microsite in Kuala Lumpur yesterday.
MDV was then formed to fill the vacuum in IT sector financing – mainly due to the fact that banks only accepted hard collateral like land and factory buildings in return for loans, while most IT companies’ assets were in their knowledge workers.
Without hard collateral, even companies that had contracts from the government for its flagship applications could not obtain loans from commercial banks.
“The Nurturing Services and Nurturing Microsite launched by MDV is a good model of how a financier can add value to ensure that businesses benefiting from its loans can accelerate their efforts toward success,” he said.
He said this was a new service strategy that would mitigate risk for the financier; it provided all the tools for good management to ensure the success of the business.
“I hope other financial institutions will take a page from MDV’s book and explore mitigating their own risks by ensuring that value-added service, including nurturing and project or business monitoring, is included as part of the loan process,” he added.
Jamaludin said MDV had built a feasible model and had fulfilled its role as a world-class financier and development facilitator of the ICT and high-growth sector.
MDV has implemented best practice application screening and due diligence processes as well as project assessment and management tools which serve as a template for others to follow.
MDV managing director and chief executive officer Jiro Suzuki said the company had teamed up with 27 professional service providers in various fields – including human resource, training, consulting, marketing, outsourcing and capital investment – to allow MDV debtor companies to subscribe for these services at a discount.
To complement the new service, MDV launched Nurturing Microsite, a website featuring the Nurturing Services offered by MDV partners and service providers.