Key Features of SME Assistance Guarantee Scheme (SAGS)

* Guarantee cover provided by CGC - 80 per cent guarantee cover on principal and normal interest. Risk on the remaining 20 per cent will be borne by the participating financial institutions

* Guarantee fee - No charges

* Interest/financing rate charged - Determined by the participating financial institutions

* Source of funds - Participating financial institutions

* Purpose of financing - Working capital. Project financing. Capital expenditure. Shall NOT be used to refinance existing credit facilities.

* Eligibility criteria - SMEs with shareholders funds below RM3 million; SMEs that are not affiliates and subsidiaries of GLCs and PLCs; SMEs owned by Malaysians (at least 51% shareholding) residing in Malaysia and SMEs adversely impacted by the current economic slowdown.

* Maximum financing tenure - 5 years.

* Maximum financing amount - Aggregate financing of RM500,000 per SME.

* Application deadline - Open from 3rd February till 31 December 2009 or upon approval of financing up to RM2 billion, whichever is earlier. The continuation of the Scheme thereafter will be subject to review.

* Participating financial institutions - All commercial banks, All Islamic Banks, Agrobank, Bank Rakyat, SME Bank, EXIM Bank and Bank Simpanan Nasional.