KUALA LUMPUR: Micro enterprises are not planning to utilise the automation and training schemes announced by the government in 2024 Budget due to the challenges in accessing the support. RAM-CTOS Business Confidence Index (BCI) showed that close to 70 per cent of micro firms do not plan to utilise the automation and training schemes announced under Budget 2024 and the main reason cited was not knowing where and how to apply for these schemes.
For small and medium enterprises (SMEs), about 80 per cent intend to utilise the schemes for automation and/or training and around a quarter expressed facing similar barriers to access.
"Government schemes are needed to support micro SMEs to scale up and innovate, but they should be preceded by effective communications and outreach programmes to reach the right target groups. "Onboarding and administrative processes should also not be overly complex or cumbersome for applicants," said RAM Holdings Bhd Group chief executive officer (CEO) and executive director Chris W.K. Lee in a statement.
A total of 141 firms were polled for the survey.
The BCI declined for the second consecutive quarter in the fourth quarter of 2023, pulled down by the negative sentiments of MSME respondents.
The overall index fell to 48.9 from 50.4, signalling pessimism about business prospects in the next three months.
It highlighted bearish sentiments that were particularly pronounced for MSMEs as expectations for sales growth, profitability and capacity utilisation were weak across the board.
It added business conditions largely worsened among surveyed firms towards the latter portion of the year.
Nearly 40 per cent and 50 per cent of respondents reported lower sales and profit in Q4 2023 compared to Q1 2023. "The survey's findings underscore the necessity for a tailored approach in addressing the diverse needs of businesses. "While financial aid remains crucial for MSMEs, the SMEs and larger corporations seek support in enhancing their operations, including automation and upskilling to navigate the evolving business landscape. "It is also worth noting that in Budget 2024, the government is offering substantial funds to assist SMEs in digitalisation, providing a unique opportunity for businesses. "Therefore, it is crucial for businesses to adapt and take advantage of this funding," said CTOS Digital Bhd group CEO Erick Hamburger.