ContextSpecial address by Abdul Rasheed Ghaffour, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 31st CGC Awards, Kuala Lumpur, 11 August 2026.
Why it mattersShows how Malaysia's central bank wants to help small firms through shocks without simply shifting risk onto public schemes.
- Small businesses face geopolitical, technological and climate disruptions.
- Temporary cash-flow pressures threaten viable firms.
- Credit guarantees can shift risk instead of sharing it.
- Offer targeted relief to viable firms during disruptions.
- Strengthen and coordinate Malaysia's credit guarantee framework with World Bank help.
- Combine financing with capability-building for SMEs.
Read the speech summary
1. Adapting to change
Speaking at the 31st Credit Guarantee Corporation awards in Malaysia, Governor Abdul Rasheed Ghaffour said adaptation, not standing still, drives success amid geopolitical uncertainty, rapid technology and climate disruption. Malaysia is in a strong position, with 5.4% growth in the first quarter, 2.9% unemployment and 1.6% inflation. Small firms, about 40% of output and nearly half of jobs, still face higher costs, thin margins and slow customer payments, which a 5 billion ringgit relief facility has eased, though temporary relief cannot answer recurring shocks.
2. A new guarantee scheme
He launched a 10 billion ringgit BNM-CGC Guarantee Scheme, a more scalable, market-based way to share risk for microenterprises, start-ups and firms in sustainability, innovation, strategic sectors and food security. Some viable firms are overlooked by conventional assessment because they have little history or collateral. A guarantee should not dilute lending standards; what makes it worthwhile is financing that would otherwise be declined or offered on better terms. The bank, with World Bank technical help, will also improve the wider guarantee framework through better coordination, targeting and data.
3. Three areas of progress
Widen the financing frontier to innovation and climate activities; assess firms in totality using cash flows, e-invoices and payment behaviour, as a complement to prudent underwriting; and pair finance with capability-building through platforms such as imSME and MyKNP, so that more firms grow into stronger mid-sized companies. His warning to lenders: sharing risk must never become a way of passing it on.