Bank Rakyat’s 360° approach to focus on entrepreneurs and cooperatives

Bank Rakyat recently introduced a new set of vision and mission to realign with its objective to improve the economic status and development of communities.

The importance of entrepreneurship has magnified in today’s economic landscape. It introduces a crucial element of dynamism, particularly into an economic system. Entrepreneurs are often regarded as national assets mainly because they contribute in terms of innovation, jobs and improve the conditions for a prosperous society.

A National Entrepreneurship Policy 2030 was launched by the Ministry of Entrepreneur Development and Cooperative (MEDAC) in July 2019 with the objective of rationalizing and refocusing all entrepreneur development programmes in order to support the nation’s economic agenda and create a conducive and integrated entrepreneurship ecosystem. 

Minister of MEDAC, Dato Sri Dr Hj Wan Junaidi Bin Tuanku Jaafar (center), and Chairman of Bank Rakyat, Datuk Haji Abd Rani Lebai Jaafar (second from right) during the launching of SMEC KL. Also present are Acting Chief Executive Officer of Bank Rakyat, Dato’ Syed Abdul Aziz Syed Hassan (most right), Chief Marketing and Communications Officer, Nizam Sani (third from right), Deputy Chief Executive Officer, Business, Dr. Mohammad Hanis Osman (second from left)  and Chief Business Banking Officer, Mohamad Shiblie Abg Sapuan (most left).

According to the Minister of Entrepreneur Development and Cooperative, Dato Sri Dr Hj Wan Junaidi Tuanku Jaafar, MEDAC is committed to continuing the entrepreneurship agenda and ensuring that the allocated announced would benefit the targeted sectors, in line with the aspirations under the National Entrepreneurship Policy 2030. 

“The Ministry will continue to be committed in providing entrepreneurial advisory services to answer inquiries, provide information and provide help and support to entrepreneurs,” he said.

As an agency of MEDAC, Bank Rakyat can play a major role in enabling the entrepreneurship industry through the Small and Medium Enterprise (SME) and cooperative sector, to be significant drivers of Malaysia’s economy. 

SME is an important component of Malaysia’s economy. To reap their full potential, SMEs must be continuously developed and nurtured to become more competitive. In line with Malaysia’s National Entrepreneurship Policy 2030, which seeks to have SMEs account for 50% of Malaysia’s Gross Domestic Product by 2030, Bank Rakyat is committed to supporting this key economic sector with targeted products and services. 

Through our Business Banking Division, we continue to expand our end-to-end financing solutions, ensuring that SMEs and micro businesses have access to the financing and assistance that they need. On top of that, the Bank also helps to develop a special SME package and provide shariah advisory services as part of its financing programmes for the manufacturing of Halal product industry. 

Chairman of Bank Rakyat, Datuk Haji Abd Rani Lebai Jaafar, stated that as a Development Financial Institution, Bank Rakyat is the pioneer for cooperative and entrepreneurship movement in Malaysia, guided by a vision of reducing social inequalities across rural societies. 

“Our mandate was to raise the social and economic status of these communities, provide them with opportunities for self-improvement and to build a more promising future for their families and communities. From our present position of strength and capitalising on our core competencies, it is a role that we continue to play to this day,” Datuk Haji said.

Financing facilities

As part of the Bank’s strategy in remaining competitive and adaptive to the current economic landscape, Bank Rakyat has laid-out a long-term plan to diversify its financing portfolio in a bid to grow and become more sustainable in the long run.

Bank Rakyat offers Micro Financing-i to entrepreneurs who need funds and financing to expand and improve their business. Next, Business Financing-i, Current Account-i (eCA-i) and Term financing-i for companies and cooperatives. Bank Rakyat also have products specifically for Small and Medium Enterprise (SME) that provide good benefits for them. Bank Rakyat will also continue its journey in providing customized package for states that best suits their niche market as we aim to help in expanding these businesses to the Global Market.

The Bank’s journey will continue with our aspirations to provide customized package for states as niche suitable with their specialty that have potential for Global Market. 

On top of that, our Ar-Rahnu X’Change offers qualified cooperatives the opportunity to own a pawnbroking business based on Shariah principles under a franchise programme. This has experienced significant growth as it is seen as a sustainable option for a Shariah developmental approach compared to the conventional pawnbroking model.

As we continue to expand our products and services offering for SMEs, we are committed to working together with stakeholders to serve the national development agenda.

Renewed vision and mission

According to Acting Chief Executive Officer of Bank Rakyat, Dato’ Syed Abdul Aziz Syed Hassan, the transition from the Ministry of Domestic Trade, Co-operatives and Consumerism to Ministry of Entrepreneur Development and Cooperatives in 2018 has also resulted to the Bank’s realignment in its role towards the development of the entrepreneurship sector. 

“Part of our commitment is by the establishment of SME and Cooperative Centres as one of the five key blueprints that will drive Bank Rakyat towards realizing the Bank’s strategic plan, Bank Rakyat 2025 (BR25) target.” Dato’ Syed added.

In order to remain vigilant and relevant, Bank Rakyat also intensifies its commitment to elevate the economic well-being of members, customers and nation through its new vision and mission.

Bank Rakyat’s new vision to be ‘Malaysia’s No.1 Progressive Islamic Cooperative Bank’ while its new mission is ‘Enhancing economic well-being of our members, customers and nation’.

The new vision and mission coincides with the objectives of Bank Rakyat’s establishment that aims to improve the economic status and development of communities as well as driving the cooperative and entrepreneurship sector for the benefit of members and customers.

This initiative is in line with the Ministry of Entrepreneur Development and Cooperative’s aspiration to rationalize and refocus all entrepreneur development programmes in order to support the nation’s economic agenda and create a conducive and integrated entrepreneurship ecosystem.

Establishment of SME and Cooperative Business Centre (SMEC)

The aim to intensify our commitment in helping the development of the SME, micro and cooperative industry has resulted in the establishment of Bank Rakyat’s SMEC. The establishment of the business centre is very focal for the Bank to emerge as SME one stop centre through not only financing but business insights and business networking. 

This initiative is in line with MEDAC’s National Entrepreneurship Policy 2030 agenda which is to establish Malaysia as a full-fledged entrepreneurial nation by 2030.

According to Chief Business Banking Officer of Bank Rakyat, Mohamad Shiblie Abg Sapuan, through this centre, Bank Rakyat will provide end-to-end processes for SME and cooperative financing, advisory services to help SMEs and cooperative customers scale the businesses as well as helping them to overcome market barriers. 

“To ensure the effectiveness of Bank’s SMEC, Bank Rakyat will partner with various agencies within the MEDAC ecosystem, as well as communities, cooperatives and private organisations to ensure a system of shared prosperity,” said Mohamad Shiblie.

As of December 2020, three SMECs have begun in operations which is in Melaka/Negeri Sembilan, Selangor and Kuala Lumpur region. By the end 2021, Bank Rakyat is targeting to have 10 SMEC’s across the country.

Going digital

The only way to compete and remain relevant with the ever-changing economy landscape is to adapt to the digital world. Realizing the importance of utilizing the digital platform – Bank Rakyat went through digital transformation process to a new core banking system, CoBRa to upgrade and improve the quality and operation of its banking services.

In line with this digital transformation, Bank Rakyat launched Quick Response to Entrepreneurs (QR2E), a virtual banking platform for small and medium enterprises, micro and cooperative that is specifically designed to assist entrepreneurs by providing comprehensive, fast, and simple digital financial advisory services and product application as part of its Banker to Entrepreneur (B2E) initiative.

B2E is a new mind-set that will enable banker to understand from the entrepreneur point of view. This new mind-set will be the paradigm shift in unlocking a new dimension of thinking, conscious, and understanding on both sides of a coin; entrepreneur and the Bank’s perspectives. With this kind of thinking and understanding only can the banker truly knows the entrepreneurs’ needs.

QR2E, a latest innovation by the Bank will be a platform for the Bank to engage with potential customers and expand the Bank’s outreach which can be done via QR Code scanning.  

The content of QR Code is more personalized in terms of application and can facilitate the Bank’s product and services to reach customers at a very fast speed. Targeted to mobile users, QR codes are cost-effective, universally applicable and can help Bank Rakyat to reach target audience in the offline world and connect them directly to digital platforms. Simultaneously, this platform brings together the bank and customer. 

Proactive measures during COVID-19

As we are aware of the challenges faced by customers mainly those who are in the entrepreneurship and cooperatives sector that have been heavily affected by COVID-19, Bank Rakyat has offered moratorium as well as targeted financial payment assistance to our customers to help mitigate the financial consequences of the outbreak. 

To date, 188 entrepreneurs have benefited from this assistance with a total exposure of RM3.04 billion.

Chairman of Bank Rakyat, Datuk Haji Abd Rani explained how proactive measures were taken by the Bank to help businesses to weather the COVID-19 storm through its “Bank Rakyat Cares”. RM300 million was allocated by the Bank to help cooperatives, small and medium enterprises (SMEs), and micro businesses as well as retail-based businesses affected by the pandemic. On top of that, BizLady, a special financing facility to help women entrepreneurs was also introduced to ensure economic survival of businesses in the wake of the COVID-19 pandemic.

Bank Rakyat achieved another milestone when it received gold award for Agency Best Programme 2020 in the category of micro, SME and cooperative financing from MEDAC through its Bank Rakyat Cares program.

“Through this campaign, micro-entrepreneurs who fulfilled the set criteria obtained financing assistance between RM1,000 to RM50,000 for the period of up to 69 months. As for small and medium enterprises (SMEs) and cooperatives, its entrepreneurs obtained financing assistance between RM20,000 to RM300,000 for the period of up to 69 months as well. By December 2020, the RM300 allocated fund was fully subscribed by businesses across the country,” added Datuk Haji Abd Rani.

“Bank Rakyat Cares” initiative did not go unnoticed as it received recognition from the Ministry of Entrepreneur Development and Cooperatives (MEDAC). The Gold Award for Agency Best Programme for the year 2020 in the category of micro, SME and Cooperative Financing is testament to the positive impact it brings to the local entrepreneurs’ sectors.

Community Development

As part of our community outreach initiative to empower the community, Bank Rakyat has so far introduced two Entrepreneurship Development Centres. One of the centre is located at Pulau Bum Bum, Sabah which process sea produce like fish into crackers while the other one is located in Arau, Perlis which is working on the production of fermented beef. 

The objective of the entrepreneurship development centre is to help the local communities by creating more job opportunities for them as well as encourages them to venture into business. The Bank is also targeting to open two more centres by the end of 2021.

In 2020, Bank Rakyat also kicked off its latest project called Rakyatprenuer. Rakyatpreneur is a philanthropic initiative with the aim of uplifting B40 micro entrepreneurs with high potential to progress across business value chain. The objective is to assist small businesses from underserved background with high potential to progress across the business value chain as well as to contribute to the local communities, and establish relationship with prospective business customers. 

Rakyatpreneur kicked off in 2020 with the aim of uplifting B40 micro entrepreneurs with high potential to move up the business value chain.

A total of 20 micro entrepreneurs were selected to participate in its pilot project which each of them received RM5,000 fund from the Bank. To ensure a sustainable result to this initiative, Bank Rakyat will not only provide financial assistance, but entrepreneurs involved will also be given proper exposure, financial advisory, mentoring, training as well as coaching through a webinar program as part of the Bank’s collaboration with the National Entrepreneurship Institute (INSKEN).

Meanwhile, Rakyatpreneur 2.0 is expected to be launched this upcoming July 2021 where funds of RM3 million will be allocated to focus on the development of 300 selected asnaf and B40 entrepreneurs from all over the country.

According to the Chief Marketing and Communications Officer of Bank Rakyat, Nizam Sani, the Bank is positive that such an initiative would strengthen the talent of local entrepreneurs and cultivate an entrepreneurial culture among the community, in line with the Government’s aspiration to become a high-income entrepreneurial country. 

Teach them young

For a Bank that provides financial solutions to all walks of life – Bank Rakyat is not leaving our kids behind when it comes to promoting entrepreneurship. Through its Kelab Nuri, Bank Rakyat has always been active in conducting activities that would be beneficial for the children’s development. 

In August 2020, a milestone was achieved by Bank Rakyat as the Bank’s received recognition from the Malaysia Book of Records for the largest school participation in an entrepreneurship initiative. Bank Rakyat achieved the accolade as 132 schools and 24,657 students had taken part in the Nuri Teenpreneurship programme nationwide. Such initiative is crucial as the younger generation will be exposed and equipped with a wide range of skills within the entrepreneurship framework. 

“On top of that, in line with our core community outreach initiative which is to provide nutritional food to underprivileged students, Bank Rakyat also has an initiative called Kebun Nuri Nutrisi which gives financial assistance to schools and universities to fund the development of community gardens.

“Through the programme, participating schools and universities are able to purchase agricultural equipment, soil, fertilisers, seeds and packaging which can be used to grow crops to sustain Nuri Nutrisi initiatives by allowing kids to sell the surplus produce that came from the respective gardens. Kebun Nuri Nutrisi not only allows us to help student to get nutritional food supply, but also to help in nurturing the students’ passion for entrepreneurship business and assist underprivileged students in getting nutritional food.” Nizam added.

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