Malaysia Debt Ventures aims to tackle high default ratio on loans
KUALA LUMPUR: Malaysia Debt Ventures Berhad (MDV) will undertake measures to reduce its high gross default ratio from 24% to 14% this year, its chairman Lee Kah Choon said in a briefing at the company’s corporate office today.
MDV, which was set up in 2002, was mandated by the government to facilitate the development of high impact and technology-driven sectors of the economy by providing accessible and innovative project financing for the technology-based SME sector.
“The net default ratio stood at around 9% and the company aims to bring it down to 4% this year,” Lee said.
He explained MDV provides financial assistance to companies that fail to receive any aid from traditional financial institutions due to the lack of business assets and track record.
To reschedule loans is one of the measures to address delinquent loans, he added.
To date, MDV has disbursed RM11.7 billion, financing 758 technology companies and enabling them to deliver 878 projects in various technology areas.
It is offering financial assistance to 73 companies, with 63 of them in the Green Tech sector with 150 MW of renewable energy.
Lee said MDV’s exposure to the Green Tech sector stands at RM810.7 million with RM519 million in renewable energy and RM134.8 million in energy efficiency.
MDV is an important component of the Green Technology Finance Scheme (GTFS), which was launched by the government in 2010. The scheme encourages local companies and entrepreneurs to be involved in green technology-based projects to support the national green technology agenda.
The government has established a RM2 billion fund to support GTFS participants.
MDV will also play a pivotal role in the government’s green agenda in providing an additional 4000 MW of energy by 2030. The government will announce large scale solar and Feed In Tariff (FIT) requirements by the third quarter of 2019.
It also has an energy saving target of up to 137,775 GWh of RM46.9 billion from 2016 to 2030 by implementing energy-saving measures.